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UPDATE 2-NYSE Euronext to rival LSE for London listings
* NYSE Euronext sets up London offshoot
* Announces Eurotunnel as first listing
* Eurotunnel sees single platform easing access to its stock
By Luke Jeffs and Kylie MacLellan
LONDON, June 20 (Reuters) - NYSE Euronext has launched a London-based exchange to challenge the London Stock Exchange for international listings, in a move that for the first time gives the LSE competition over lucrative large flotations on its home turf.
NYSE Euronext, which wants a London presence to match its businesses in Paris and New York, on Wednesday unveiled NYSE Euronext London as a regulated exchange and said Groupe Eurotunnel had become its first listing.
Eurotunnel, which has a market capitalisation of 3.5 billion euros ($4.4 billion), previously had a dual listing with the LSE in London and NYSE Euronext in Paris, but has effectively opted for the transatlantic exchange in Paris and London.
The owner of the rail tunnel linking Britain and France said it had moved its London listing, which was near dormant in terms of trading interest, to benefit from better liquidity and a broad investor base.
"Our London listing has not had enough liquidity. A single trading platform and a single order book will simplify access to our stock," said Jacques Gounon, chairman and chief executive of Groupe Eurotunnel.
The establishment of a London-based stock market by NYSE Euronext pitches the exchange group into competition for new and existing listings with the LSE, which wants to be the venue of choice for international companies seeking to broaden their investor base.
"NYSE Euronext's London-based listings venue looks to extend the group's strong brand to international firms looking to list in London and access its deep pool of institutional investors," said Richard Perrott, an analyst at Berenberg Bank.
London, which has more listed companies than any other European exchange, has seen little initial public offering activity over the past year as stock markets struggle with worries about euro-zone debt.
Last month Georgian Railways and Russian real estate investor O1 Properties both pulled planned London listings due to choppy markets.
"Clearly the listings market has seen a cyclical slowdown, but companies should feel more comfortable about returning to the market once the issues in the euro zone have been resolved," said Perrott.
NYSE Euronext was forced to drop its planned $7.4 billion merger with Deutsche Boerse in February after European competition authorities opposed the deal.
A spokeswoman for the London Stock Exchange did not comment on Eurotunnel's move.
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