The name of the game

25 May 2007 By Nicole Lee

It s hard to make the cashandshares deal stack up on its own. The returns on the Nordic exchangeandtechnology group look meagre. But Nasdaq has another concern its 30% stake in LSE. OMX might provide a Scandinavian appetiser to the big London meal.

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Nasdaq Stock Market said on May 25 that it has made a recommended offer to buy Nordic technology and exchange group OMX for $3.7bn (SKr25.1bn) or SKr208.1 a share. That represents a premium of 19% to OMX's closing price of SKr174.5 on May 23, the last full trading day before the announcement of the merger. Nasdaq is offering 0.502 new Nasdaq shares plus Skr94.3 in cash for each OMX share.

The deal is expected to generate annual pretax cost synergies of about $100m (SKr683m) in 2010, and annual pretax revenue synergies of about $50m (Skr342m) over three years. Nonrecurring pretax costs to achieve these synergies are expected to be $150m (SKr1bn), incurred in the two years after the deal has been completed.

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