NYSE says won't push Deutsche Bourse deal at all costs

NYSE Euronext Chief Executive Duncan Niederauer on Thursday signalled he would rather walk away than force a deal with Deutsche Bourse as European Union regulators get ready to outline their terms for approving the $9 billion merger. "At some point, the logic of the combination would not hold together if we are asked to give up too much. This is not where we are right now," Niederauer said on a conference call in which he also discussed third-quarter earnings.
He reiterated his confidence in "the compelling industrial logic of the merger" following a meeting with the European Commission last week to make the case for the deal, which has caused antitrust concerns because of the tight grip such a company would have on exchange-based financial futures trading in Europe.
Another meeting is set for next week as a November 17 deadline approaches for NYSE Euronext and Deutsche Boerse to offer concessions that would ease regulators' concerns, such as opening up businesses to rivals or selling some operations. The meeting - which a source said is on Tuesday - should help the companies "determine how to better work with (the regulators) to further narrow and address their remaining concerns," Niederauer said on Thursday.
A key way to measure which remedies are acceptable is to look at whether EU demands put the cost savings promised to shareholders in jeopardy, a person familiar with Deutsche Bourse's thinking said on Thursday. This in effect means that the companies cannot agree to sell one of the two derivatives exchanges, Eurex or Liffe, because they would no longer be in a position to deliver the synergies, this person said.
Another source close to Deutsche Bourse said the process of discussing possible remedies began this week in anticipation of a "state of play" meeting with the European Commission and representatives of both Deutsche Bourse and NYSE on November 8. At this meeting, it will become clear whether arguments brought forward by NYSE and Bourse during the oral hearings in Brussels were heeded by the European Commission, the second source said.