We needed HK’s spotlight on this bid for Refinitiv

TODAY’S capitulation by the Hong Kong Stock Exchange came sooner than I’d have liked.

Not that the tie-up between London and its former colony was a good deal — politically it was never going to work — but I was looking forward to a well-researched critique by the Hong Kongers of the LSE’s vast bid for the Reuters data operation Refinitiv.

To recap: before HKEX came along, the LSE had agreed to pay £22 billion for Refinitiv. Hong Kong knew it couldn’t afford the combined business, so it had to swoop before the deal went ahead. Hence the bizarre sight of them bidding amid riots on the streets of their city.

Had they not thrown in the towel, the next stage of the assault would have been to pose the hard questions of the Refinitiv deal that have not yet been properly asked. Certainly not by Goldman Sachs, Morgan Stanley, Barclays, RBC, Evercore and Jefferies, who are all being paid to work on it.

Such as: why buy the business now when the LSE and every other exchange decided against it a couple of years ago? Why buy a business led by trading terminals inferior to Bloomberg’s? Why pay its private equity owners double what they paid for it less than two years ago?

The LSE sees data as being crucial to its future and believes Refinitiv’s CEO is turning the business around.

Maybe he is. Goldman just ordered 5000 Reuters Eikon terminals, so it’s clearly a fan. But then, it would be

— it will make millions as LSE’s adviser on the transaction, and LSE chief David Schwimmer and Martin Brand, architect of the deal from Blackstone’s side, are ex-Goldmanites.

But some cynical questioning from outside the fee-hungry City bubble would have been nice.