Hong Kong bid to charm LSE’s shareholders

SEnIoR figures from Hong Kong’s stock exchange are launching a charm offensive to win over London Stock Exchange shareholders this week.

Representatives of chairman Laura Cha and chief executive Charles Li have flown to London and are preparing to meet LSE investors to convince them of the merits of their £32bn bid.

They will also meet regulators at the Bank of England and Financial Conduct Authority amid concerns about the proposed deal, including potential Chinese influence.

But they face an uphill battle and are likely to have to sweeten the offer, which involves a £7.2bn cash payment and a 41pc stake in the combined business.

one of the LSE’s top-15 shareholders told the Mail they would need the offer from Hong Kong Exchanges and Clearing (HKEx) to be ‘substantially increased’ – and include a larger cash element. The shareholder added that HKEx had not yet approached them to organise a meeting.

HKEx made a surprise bid for the LSE last week. It was rebuffed days later by the exchange’s board.

The LSE, which traces its roots back to the 16th century, called the approach ‘fundamentally flawed’.

David Schwimmer, the LSE’s chief executive, was understood to have been stunned by the approach from HKEx when the two companies met last Monday, as he had thought the meeting was just a routine catch-up.

The Government, and financial regulators around the world, are understood to be looking closely at the HKEx offer.

Hong Kong’s government owns 6pc of HKEx and regulators will be wary of any power that China’s communist regime may be able to exert.

The LSE announced last month it wanted to buy data firm Refinitiv for £22bn.