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BUSINESS
NYSE in $21bn Euronext merger bid
Euronext shareholders met to discuss
the firm's fate.
The New York Stock Exchange (NYSE) has unveiled plans to merge with the pan-European Euronext exchange. The proposed move would create a transatlantic stock market giant worth 16bn euros ($21bn; £11bn). Under the terms of the deal, each NYSE share would be converted into one share of common stock in the merged company, which would be renamed NYSE Euronext. If successful, the merger bid would trump rival plans by Germany's Deutsche Bourse for a tie-up with Euronext. Shareholder decision: Euronext controls the Paris, Brussels, Lisbon and Amsterdam exchanges, as well as the London-based Liffe international derivatives exchange. The Paris-based operator has itself been at the centre of takeover plans for the London Stock Exchange (LSE). News of the NYSE offer comes a day before Euronext's annual general meeting, where shareholders are expected to consider the future of the company. A merger between the NYSE and Euronext would see NYSE Group boss John Thain become chief executive of the combined group, with Euronext chief executive Jean-Francois Theodore becoming deputy chief executive officer. Separately, the Financial Times Deutschland reported on Monday that Deutsche Boerse was considering making an all-share offer for Euronext. The German operator reaffirmed its interest in merging with Euronext.
Top law firm faces fraud charges
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'Particularly incensed': Milberg Weiss said it was "particularly incensed" that the government chose to indict the firm, which includes 125 lawyers among its 365 employees. "It is unprecedented for a law firm to be indicted," said Les Corwin, a lawyer with Greenberg Traurig, in New York. Specializing in class actions, New York-based Milberg Weiss has in the past brought cases against collapsed US energy group Enron, and against Swiss banks on the behalf of Holocaust survivors. It has won more than $45bn in damages in total from suits against big businesses. Many of its cases are brought for shareholders who claim that flotations were manipulated by investment banks to inflate market prices. US shares fall as Europe rebounds US stocks closed down on Tuesday after initially looking likely to follow the European trend and bounce back. Having recorded its worst finish in six months, the Nasdaq lost another 0.62% and the Dow Jones dropped 0.24%. European markets soared following the recent falls. The FTSE 100 added 2.6%, erasing this month's falls, with German and French markets up more than 2.4%. Earlier Asian shares slumped with the Nikkei index hitting a three-month low. With continuing concern about interest rate rises in the US, analysts say all global markets remain nervous. Stocks have also fallen on fears that markets had recently become overheated. According to this view, the recent declines are simply market corrections, as shares fall to more realistic levels after hitting recent near-record highs. All-time record: Analysts were divided upon
whether rises in Europe marked the start of a wider recovery, or
whether stocks could fall again. "If these levels can hold, a rally may
emerge as investor confidence recovers," said S&P Equity Research. In
contrast, one trader at a French bank said that despite the bounce backs,
"the market outlook is still pretty uncertain". In the US, analysts were
cautious about the prospects for the commodity and equity markets. "This
is not the time to be backing up the truck and loading up with apparently
cheap stocks," said DA Davidson strategist Fred Dickson. US shares had
rallied early in the day, helped by rebounding oil and gold prices. But
comments by US Energy Secretary Sam Bodman that soaring energy prices may
hit economic growth fuelled inflation concerns leading to more sell-offs.
Early this month, European rally followed huge falls late on Monday
in Europe, as shares staged a last-minute slide which took the FTSE down
125 points or 2.5% to a five-month low. Similarly in Asia, Australia's
main S&P/ASX 200 index had fallen 70 points to close at 5,031 while
Japan's Nikkei fell even further - dropping 259 points to 15,599.20, its
lowest close since 20 February. With concern that the US Federal Reserve
is to continue to raise interest rates to tackle inflation, market jitters
are expected to remain. Higher US interest rates put a brake on consumer
spending and corporate investment, squeezing profits and jeopardizing
growth in the global economy.
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One
of the US's biggest law firms has been indicted by a federal grand
jury - accused of paying people who agreed to be plaintiffs in class
action cases. Milberg Weiss Bershad &
Schulman, and two of its partners, face 20 charges including fraud,
perjury and bribery. The firm's officials deny the charges, describing
the indictment as "unjust". Prosecutors claim that over 20 years, the
defendants paid bribes to three clients in lawsuits which netted the
firm more than $200m (£107m) in fees.
As well as Milberg Weiss itself, the two partners facing
charges are David Bershad and Steven Schulman. 