Euronext to cut 16% of Irish Stock Exchange jobs

ISE deal set to deliver higher-than-expected cost savings, at a larger cost, Euronext says

The planned redundancies are expected to take place by the end of the year. Photograph: Dara Mac Dónaill

The planned redundancies are expected to take place by the end of the year. Photograph: Dara Mac Dónaill

 

Pan-European stock exchange operator Euronext is planning to cut about 20 jobs at the Irish Stock Exchange (ISE), which it acquired earlier this year from a group of Dublin stockbrokerages in a €158.8 million deal.

The planned redundancies, mainly in support functions, are expected to take place by the end of the year and equate to about 16 per cent of the workforce at the Irish bourse, which now trades under the name Euronext Dublin.

“Euronext has made efficiency savings in some functions, where there was overlap between Euronext and Euronext Dublin,” a spokeswoman for the ISE said. “Euronext has carried out some group-wide analysis on positions and engaged with relevant staff.”

The spokeswoman declined to comment on the number of positions being eliminated. However, she said Euronext had also “identified additional roles that will be created in Dublin”. The group has made Dublin its hub for debt and funds listings as well as for exchange-traded funds (ETFS).

Euronext said on Tuesday it will move stock trading on the Dublin market to its own trading platform in February after signing an agreement terminating the ISE’s current reliance on Deutsche Börse technology.

Integration costs

The group said it now planned to extract €8 million of cost savings from the ISE deal by the end of the decade, up from a previous estimate of €6 million. However, it said that integration costs will now run to about €14 million, against a prior forecast of €9 million.

The Irish Times reported last month that the ISE’s recently-departed chief executive, Deirdre Somers, enjoyed a €5.75 million pay day last year, driven by a cash windfall and bonuses linked to the successful Euronext transaction.

The takeover deal triggered €8.83 million of cash payments for top executives under a so-called share appreciation rights scheme, as well as €4.66 million of bonuses and other compensation for senior staff, according to the company’s recently-filed accounts with the Companies Registration Office.

Ms Somers was succeeded last month by Daryl Byrne, the company’s former chief regulatory officer. The ISE’s former director of traded markets, Brian Healy, quit in June.

Windfall

Euronext, originally established in 2000 through the merger of the Paris, Brussels and Amsterdam stock exchanges and joined two years later by the Lisbon bourse, said in August that its revenues increased by €20 million in the second-quarter to €157.3 million, partly driven by the consolidation of Euronext Dublin.

The sale of the ISE delivered a windfall for the company’s owners, Davy, Goodbody Stockbrokers, Investec, Cantor Fitzgerald and Campbell O’Connor. In 2014, the owners – which at the time also included Royal Bank of Scotland – shared a €27.5 million pot as the exchange reorganised its structure.

The remaining owners received a €5 million dividend payment last year ahead of the Euronext deal.