Euronext’s proposal to acquire the Athens Stock Exchange has landed with a thud rather than a splash. Despite offering a 14.4% premium over the previous trading price—valuing Hellenic Exchanges (HELEX) at €6.90 per share versus a close of €6.03—the offer has failed to generate enthusiasm. The reason is simple: the bid includes no cash. Instead, it relies entirely on a share exchange, offering 21.029 HELEX shares for every one new Euronext share.
This all-stock approach raises immediate concerns. The exchange ratio is based on a Euronext share price of €145.10, a level close to its historical high. Should Euronext’s share price decline, the value of the deal for HELEX shareholders could fall sharply. While the implied valuation of €399 million represents a theoretical premium over HELEX’s current €363 million market capitalization, the lack of a cash component makes the offer far less appealing.
From a valuation standpoint, the deal looks stretched. Based on projected 2024 figures—€54.3 million in revenue and €23.7 million in EBITDA—the offer implies an EV/EBITDA multiple of 16.8x, up from the current 15.3x. While this may be acceptable for a mature monopoly like a national stock exchange, it is hardly generous, especially in a deal offering no immediate liquidity to investors.
The Greek government has publicly welcomed Euronext’s interest. However, it is not a shareholder in the Athens exchange and therefore approaches the deal from a political rather than financial perspective. Investors, on the other hand, must weigh the offer’s merits with a more critical lens. Many are asking why Euronext—flush with €1.73 billion in liquidity—has chosen to make an all-stock offer for the Greek exchange, when it paid entirely in cash to acquire Borsa Italiana from the London Stock Exchange in 2020, and used a mix of cash and shares when it acquired the Portuguese exchange over two decades ago. The inconsistency fuels suspicion: why apply different standards now?
This skepticism only deepens when considering the aftermath of Euronext’s past acquisitions. History suggests that its ownership is far from frictionless. In fact, costs have risen and labor tensions have emerged at each exchange it has taken over. The most glaring example comes from Italy. On June 27, 2024, workers at Borsa Italiana staged the first strike in the institution’s history. Italian unions accused Euronext of systematically scaling back investment in the Milan market, shifting strategic operations abroad, undermining job stability, and failing to meet salary expectations. The protests triggered a political response, prompting the Italian government to demand that Euronext commit to preserving strategic functions within Italy and respecting the original terms of the acquisition.
In this context, the early enthusiasm shown by Greece’s Ministry of National Economy and Finance seems premature. A public statement from the office of Minister Kyriakos Pierrakakis declared that the government views the potential deal positively. But critics argue this response came before any real understanding of the offer’s implications—and without consulting market participants or shareholders.
