Euronext - 2020 Universal Registration Document

Financial Statements

Notes to the Consolidated Financial Statements

5.2 Acquisition of VP Securities AS On 23 April 2020, Euronext announced it had entered into definitive agreements to acquire c.70% of the shares of VP Securities from its existing owners, the Danish Central Bank and four major Danish financial institutions, Danske Bank, Nykredit, Nordea and Jyske Bank (the “Majority Sellers”). The price offered for 100% of the outstanding share capital (representing 98.4% of the total shares, as VP securities owns 1.6% of treasury shares) was DKK1.12 billion (c. €150 million). Euronext opened a tag-along offer to all remaining shareholders (the “Minority Sellers”) to acquire the remaining shares at the same terms and conditions. VP Securities is the Danish Central Securities Depository (CSD), covering fixed income, equity and investment funds, and a key infrastructure helping to finance Denmark’s real economy. The acquisition of VP Securities significantly expands Euronext’s footprint in the Nordic region. The transaction will double Euronext’s central securities depository business in size, further improving Euronext’s revenue mix and marking an important milestone towards Euronext’s strategic goal of building the leading European market infrastructure. On 15 July 2020, Euronext received the clearance from the Danish Financial Supervisory Authority to acquire up to 100% of VP Securities, which was the only mandatory approval to complete the transaction. On 3 August 2020, all Majority Sellers’ shares and part of the Minority Sellers’ shares, representing in total 85.2% of the outstanding share capital of VP Securities, were settled for consideration of DKK 969.5 million, or €130.2 million. On that day Euronext became legal owner of a controlling interest of 86.8% (including 1.6% of treasury shares) in VP Securities. At the acquisition date, the Group measured the remaining 13.2% of non-controlling interest at fair value (i.e. based on the purchase consideration paid to acquire the 85.2%) for a total amount of DKK 150.5 million, or €19.9 million. Details of the purchase consideration, the preliminary net assets acquired (including preliminary PPA outcomes) and goodwill are reflected in the tables below. Purchase consideration:

The net assets and liabilities recognised as a result of the acquisition were as follows:

Fair Value

In thousands of euros

Assets Property, plant and equipment

1,425 8,070 6,043

Right-of-use assets

Intangible assets: brand names Intangible assets: customer relations Intangible assets: software platform

31,826 38,934

Non-current other assets Trade and other receivables Other current financial assets Cash and cash equivalents Liabilities Non-current lease liabilities

824

7,918

56,435 16,418

(6,447) (16,897)

Deferred tax liabilities

Non-current other provisions

(239)

Current lease liabilities

(1,623) (2,128) (6,572) (1,000)

Current income tax liabilities Trade and other payables Current other provisions Net identifiable assets acquired Less: non-controlling interest

132,987 (19,927)

17,124

Add: Goodwill

TOTAL PURCHASE CONSIDERATION

130,184

The goodwill is primarily attributable to the expected synergies and other benefits from combining the assets and activities of VP Securities, with those of the Group. The goodwill is not deductible for income tax purposes. Acquired receivables The fair value of trade and other receivables was €7.9 million, and included €5.2 million of trade receivables, which is not materially different to the gross contractual amount and it is expected that the full contractual amounts can be collected. Revenue and profit contribution From the date of the acquisition, VP Securities has contributed €27.6 million of revenue and €5.6 million of net profit to the Group. If the acquisition would have occurred on 1 January 2020, Group consolidated revenue and profit for the year ended 31 December 2020would have been €923.0million and €328.5million respectively.

Fair Value

In thousands of euros

8

Cash paid

130,184

TOTAL PURCHASE CONSIDERATION

130,184

Analysis of cash flows on acquisition

2020 (1,717) (1,717)

In thousands of euros

Acquisition related costs

Included in cash flows from operating activities

Cash consideration

(130,184)

16,418

Less: Balances acquired

Included in cash flows from investing activities

(113,766) (115,483)

NET CASH FLOWON ACQUISITION

241

2020 UNIVERSAL REGISTRATION DOCUMENT