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LSE's 'compelling' case for merger deal

Friday, March 04, 2016 - 01:43

The London Stock Exchange Group reports a jump in profits - and says a potential merger with Deutsche Boerse would be ''compelling'' as potential rival bidders line-up for the British company. Hayley Platt reports.

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Healthy profits for the London Stock Exchange Earnings rose nearly a third to 643 million pounds. Underlining its appeal to suitors as it continues talks on a merger with Deutsche Boerse, for which, says the LSE, there is a ''compelling" case. But all eyes are on a possible counterbid from Intercontinental Exchange, owners of New York's stock exchange. Simon Smith is from FXPro. SOUNDBITE (English) FXPRO, HEAD OF RESEARCH, SIMON SMITH, SAYING: "I don't think from the market they probably think that a tie up with Deutsche Boerse would be the stronger tie up we would see rather than ICE which is much more diversified across different products. There could be a case for saying that that would be the stronger force but I think some sort of tie up would be virtually inevitable," The US group ICE has until March 29 to make a bid or walk away. LSE chief executive Xavier Rolet says stock markets will have to get together. The prize at stake: LSE's clearing business - an increasingly important source of profits for exchanges. But it will have to get any deal past the regulators first. SOUNDBITE (English) FXPRO, HEAD OF RESEARCH, SIMON SMITH, SAYING: "I think there would be regulatory concerns if the entity that was created was seen as having undue influence in certain markets or certain sectors I don't see that necessarily as a huge obstacle." ICE is reported to be considering a spin-off of LSE's Italian business and French clearing arm as part of its proposal. But Deutsche Boerse are still seen as favourites. Although London's CME Group, Euronext and Honk Kong Exchanges are also thought to be interested.

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LSE's 'compelling' case for merger deal

Friday, March 04, 2016 - 01:43