France concerned over Paris finance hub after ICE-NYSE merger

Reuters

PARIS, Nov 12 (Reuters) - The French government on Tuesdayapproved IntercontinentalExchange Inc's takeover ofstock market operator NYSE Euronext but urged Frenchmarket players to step in to preserve Paris as a financialcentre.

The merger, worth some $10.9 billion, has been completed andis set to be followed next year by the spin-off of NYSE'sEuropean arm Euronext, which operates the Paris, Amsterdam,Brussels and Lisbon stock exchanges.

Sources have told Reuters that Dutch and French regulatorswere seeking to prevent Euronext from falling into foreignhands, and that France's main banks had been approached to takea large stake in the bourse.

In a statement late on Tuesday, French Finance MinisterPierre Moscovici said he approved the ICE-NYSE merger, butstressed the need for Euronext to have a federal, Europeanmanagement that would preserve the standing of Paris as afinancial hub.

Moscovici endorsed a report by Thierry Francq, former chiefof French stock market regulator AMF, recommending that ICE setup a group of core shareholders holding a stake of at least 25percent in Euronext and representing the interests of France,Belgium, the Netherlands and Portugal.

"Only a locally rooted stock exchange operator canadequately address the needs and specificities of its clientbase," the report said, adding that thousands of high-value jobswere at stake within France's financial "eco-system".

"The presence of a strong and dynamic bourse in Paris isalso an absolute precondition to sustaining France's influencein setting the agenda of European and international financialregulation," it noted.

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