Rolet’s £14.5m payday

Is this why the French boss of the London Stock Exchange is so keen for a German takeover?

THE Frenchman trying to sell the London Stock Exchange to the Germans could be in line for a £14.5m jackpot if the deal goes through.

Xavier Rolet yesterday described a proposed £20bn merger with Frankfurt’s Deutsche Boerse as ‘compelling’ and said it is pressing ahead with plans f or the controversial marriage. The comments came as LSE Group announced a surge in profits and payouts to shareholders, confirming London’s status as the dominant financial centre in Europe.

Last night one critic said the buoyant results raised further questions about the merits of selling out to a foreign predator and voiced fears that Rolet may be cashing in.

Analysis of the LSE Group’s latest company accounts show he is in line to make a fortune of the tie-up goes ahead.

The 56 year old owned more than half a million shares in the London Stock Exchange Group at the end of 2014.

These are worth just under £14.5m, based on the current share price of £28.53. If the LSE Group remained independent, Rolet would have had to hit performance targets f or these shares – accumulated from previous bonuses – to pay out in full. Companies are usually forced to buy out shares from executives in full when they take over another firm.

This gives company bosses an added incentive to sell out.

Justin Urquhart-Stewart, a veteran City commentator who works for wealth manager Seven Investment Management, said: ‘When you look at numbers like this there does seem to be a great incentive for bosses to cash in irrespective of whether it’s good for the company.

‘These latest results show that there is not financial need for the London Stock Exchange to merge or be taken over.

London must not sell out to an overseas rival. It would be a great shame for the UK to lose one of its primary financial pillars. If it does, business will soon seep away to Frankfurt.

It will not just be the stock exchange – London would also start losing some of its financial infrastructure such as accountants and corporate law firms.’

Both London and Frankfurt have insisted their tie-up would be a ‘ merger of equals’. But in reality Deutsche Boerse will have a controlling 54.4pc stake. Fears that Frankfurt will have the upper hand were confirmed when it emerged that Rolet, who took home a had offered to retire to ensure the deal goes through.

The two parties have confirmed that the boss of Deustche Boerse Carsten Kengeter will be the chief executive of the enlarged group. The LSE Group is already said to be considering moving control of a London-based business which settles trades in com- plex interest rate derivatives to Frankfurt. Yesterday Rolet – who took home more than £4 min the last nine months of 2014 – insisted the case for the merger was ‘compelling’ and said it would create a ‘global market infrastructure group with significant benefits for our customers and shareholders.’

Results from the LSE Group underlined why it is such a prize asset for foreign rivals. More than 70pc of the money raised by European companies floating on the stockmarket so far this year was raised in London.

Biggest deals on the London Stock Exchange last year include the £6bn float of US payment processing firm Worldpay, the £4.2bn listing of Autotrader and the £1.5bn float of TSB.

The LSE Group (down 40p to 2853p) said profits almost doubled from £182.1m to £336.1m last year.

The firm proposed a final dividend of 25.2p per share, taking the full year pay-out to 36p – up a fifth on 2014.

The LSE Group declined to comment last night.

‘A great incentive for bosses to cash in’