The mega-merger between Nyse Euronext and Deutsche Börse faces an extended investigation by the European Commission amid concerns over the impact of a tie-up on competition in clearing and derivatives trading.
The Phase II review of the proposed transaction will run for a minimum of 90 days, as European competition authorities probe the consequences of a deal on the exchange trading landscape.
"The proposed merger would remove a strong competitor from the market and would give the merged company by far the leading position in derivatives trading in Europe," EU competition commissioner Joaquin Almunia told Bloomberg in an e-mailed statement.
The $8.34 billion merger has received overwhelming approval from Nyse Euronext and DB shareholders. In a statement, the exchanges say: "The European Commission's decision to open an in-depth investigation was fully anticipated and does not in any way prejudge or prejudice the ultimate outcome."
While analysts expect the Commission to demand concessions guaranteeing open access to clearing facilities, Deutsche Börse and NYSE Euronext remain confident that their planned combination will be approved.
"The companies' combined businesses will remain exposed to important competitive constraints from OTC, other exchanges worldwide and newer trading venues, competing clearing systems, and sophisticated users," they claim, citing a potential $3 billion benefit from post-trade harmonisation for customers.