LSE gets surprise bid from Hong Kong Exchange
LONDON/HONGKONG:HONG Kong Exchanges & Clearing Ltd. made an unexpected $36.6 billion bid for London Stock Exchange Group Plc, a bold move that could upend the UK bourse’s combination with Refinitiv.
The offer faces several hurdles, as LSE’S board “remains committed to” the acquisition of data provider Refinitiv as it considers what it called an unsolicited, preliminary and highly conditional proposal.
LSE’S shares pared earlier gains, reflecting skepticism that a deal can be done in the face of escalating tensions with China over Hong Kong and the view that the $27 billion takeover of Refinitiv would allow LSE to push into financial data, offering a more secure future than a combination of stock exchanges. For HKEX, the deal promises a base away from the increasingly fraught political climate at home.
Under the proposed offer, HKEX would offer 2,045 pence as well as 2.495 newly issued HKEX shares for each LSE share. That values each LSE share at 8,361 pence, the Hong Kong bourse said in its statement. The UK company’s stock rose 6.2% to 7,190 pence on Wednesday at 10.54am in London, after earlier surging as much as 16%.
The Asian bourse operator had considered the “ambitious and far-reaching” deal for one of Europe’s largest exchanges for many months, HKEX chief executive officer Charles Li said on Wednesday.
LSE’S board said it would consider the proposal and will make a further announcement in due course.