What’s Euronext €200 Million Share Repurchase Program?

Euronext, a prominent pan-European market infrastructure, has unveiled a strategic move with the initiation of a €200 million share repurchase program commenced on July 31, 2023. The program is designed to last up to a year. It underscores Euronext’s commitment to disciplined capital allocation and financial strategies to maintain its deleveraging path and credit rating.

Euronext’s Share Repurchase Program

Commencing on July 31, 2023, Euronext’s share repurchase program is a key financial initiative. The primary goal is to reduce the company’s share capital, with the repurchased shares slated for cancellation. 

The program was authorized by the General Meeting on May 17, 2023. It allows Euronext to buy back approximately 3% of its ordinary shares, with a maximum limit of 10%. This move aligns with the company’s commitment to prudent capital management and financial strategies endorsed by stakeholders.

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Share Repurchase Program – Impact on the Traders

  • Disciplined Capital Management: Euronext’s strategic move reflects its commitment to disciplined capital allocation.
  • Financial Strategy Alignment: The share repurchase program aligns seamlessly with Euronext’s broader financial strategy, duly endorsed by stakeholders.
  • Maximum Allocation and Duration: It aims to repurchase up to 3% of its ordinary shares, with a full allocation of €200 million, spanning from July 31, 2023, for up to one year.
  • Non-Discretionary Arrangement: It has established a non-discretionary arrangement with a financial intermediary to ensure transparency and regulatory adherence in the share repurchase process.

About Euronext

Euronext, headquartered in the Netherlands, is a significant player in European capital markets. Operating stock markets across the continent, Euronext recently expanded its reach by acquiring Borsa Italiana. The company has proactive financial strategies and a commitment to responsible capital management. These factors position it as a significant force in the European financial landscape.

Way Forward

Euronext assures stakeholders of regular updates on the progress of the share repurchase program. We adhered to applicable regulations while maintaining transparency throughout. Euronext and LCH SA plan to collaborate on a smooth migration of clearing flows following Euronext’s divestment of its 11.1% stake in LCH SA. This move is part of a broader buyback program. 

The company aims to realize a tax-free capital gain of around €40 million from the sale, ensuring its financial flexibility for future opportunities while upholding its existing dividend policy.

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