NYSE Euronext said its annual report to the SEC that it incurred $85 million of legal, banking and other expenses in 2011 from its unsuccessful plan to merge with Deutsche Boerse.

The two exchange operators and technology suppliers agreed to terminate their merger agreement on Feb. 2, a day after the European Union’s Competition Commission issued a formal decision disapproving the combination. Its main objection: Concentration in derivatives trading and clearing. NYSE Euronext’s Liffe operation and Deutsche Boerse’s Eurex business would control roughly 90 percent of the European market.

The $85 million reduced NYSE Euronext’s operating income for the year by about 10 percent, to $850 million. The company reported net income of $619 million, up from $577 million the year before.

Revenue was $4.55 billion, up from $4.42 billion.

Its technology services revenue grew to $358 million in 2011, up from $318 million in 2010, according to the filing with the SEC. Information Services and Technology Solutions operating income increased $50 million to $122 million. The increase was primarily due to the growth of the company’s software business and an increase in fees charged for connecting to its new data centers in Mahwah, N.J., and Basildon, England.

NYSE Euronext operates a commercial technology business, NYSE Technologies and also owns NYFIX, a provider of services that aim to improve trading efficiency.

Market data revenues declined to $371 million, from $373 million.

And the company’s share of overall, consolidated trading in U.S. equities fell from 36.3 percent of matched volume to 34.9% (see chart).


Tom Steinert-Threlkeld writes for Securities Technology Monitor.



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