Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

Hong Kong exchange drops bid for London rival

Hong Kong exchange drops bid for London rival

Bidder’s government ties turned off owners of the acquisition target

The Hong Kong Stock Exchange on Tuesday dropped its multibillion-dollar takeover bid for the prized London Stock Exchange Group, which would have created a global markets titan.

Hong Kong Exchanges and Clearing Limited (HKEX) made the shock proposal for LSEG on September 11, but LSEG formally rejected the offer the following day citing “fundamental” flaws and concerns over its ties to the Chinese city’s government.

The huge cash-and-shares bid, which was worth £32 billion ($40 billion, 36 billion euros), was dependent on the axing of LSEG’s planned purchase of US financial data provider Refinitiv.

HKEX chairman Laura Cha said at the time of the offer that it represented a “compelling” opportunity and would bring together the largest and most significant financial centers in Asia and Europe.

However, the owner of the London and Milan stock exchanges unanimously rejected the bid, saying it fell “substantially short of an appropriate valuation for a takeover.” It also said it remained committed instead to its $27 billion acquisition of Refinitiv.


‘Disappointed’


HKEX said in a statement Tuesday that it was “disappointed” to pull its bid but that it was in the best interests of shareholders to do so.

“HKEX confirms that it does not intend to make an offer for LSEG,” the statement added.

“The board of HKEX continues to believe that a combination of LSEG and HKEX is strategically compelling and would create a world-leading market infrastructure group.

“Despite engagement with a broad set of regulators and extensive shareholder engagement, the board of HKEX is disappointed that it has been unable to engage with the management of LSEG in realizing this vision.”

Shares in Hong Kong Exchanges and Clearing rose almost three percent on Tuesday.

Chief executive Charles Li said in a blog post published on Tuesday: “I need to be rooted in our day-to-day business but forward-focused, certain that if we try something and it doesn’t work, we are strong enough and diverse enough to dust ourselves down and move forward.”

He added: “We are honest with ourselves too – as we know some things we try will not develop at the speed which we would like or, in some cases, at all. Our goal is to keep moving forward, reinforcing HKEX’s role and building Hong Kong’s strength as a financial market.”

Hong Kong lawmaker and HKEX shareholder Christopher Cheung criticised the unsolicited takeover bid, telling Bloomberg News the “whole offer was a farce.”

“When HKEX announced the offer, I thought they’ve already had discussions with London Stock Exchange and their regulators.

“It turns out they have not. HKEX now must address the danger of stagnant business growth.”

In morning London deals, LSEG shares sank 6.07 percent to stand at £70.

Since the HKEX unveiled its takeover offer last month, LSEG stock has held stubbornly below the bid level – which stood at more than £83 per share – as investors remained unconvinced.

“A concerted charm offensive failed to pay off for the Hong Kong group as investors balked at the anti-trust, regulatory and deliverability issues that the tieup implied,” noted Markets.com analyst Neil Wilson.

“And, not least, LSEG is fully committed to the Refinitiv deal.”

Refinitiv will help shift LSEG from generating revenue solely from the trading of securities to providing investors information about trading, which will put it in direct competition with data and financial news firm Bloomberg.

The transformational Refinitiv deal comes two years after LSEG’s failed £21-billion merger with Germany’s Deutsche Boerse.

That proposal – the third failed attempt at a tieup between the British and German stock exchange operators – was blocked by the European Commission on competition fears.

AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Altman Says GPT-5 Already Outpaces Him, Warns AI Could Automate 40% of Work
Russian Research Vessel 'Yantar' Tracked Mapping Europe’s Subsea Cables, Raising Security Alarms
Global Cruise Industry Posts Dramatic Comeback with 34.6 Million Passengers in 2024
U.S. Demands Brussels Scrutinize Digital Rules to Prevent Bias Against American Tech
Private Equity’s Fundraising Surge Triggers Concern of European Market Shake-Out
Tokyo’s Jimbōchō Named World’s Coolest Neighbourhood for 2025
European Officials Fear Trump May Shift Blame for Ukraine War onto EU
The Personality Rights Challenge in India’s AI Era
Italy Considers Freezing Retirement Age at 67 to Avert Scheduled Hike
Italian City to Impose Tax on Visiting Dogs Starting in 2026
Study Finds No Safe Level of Alcohol for Dementia Risk
Trump Says Ukraine Can Fully Restore Borders with NATO Backing
Europe Signals Stronger Support for Taiwan at Major Taipei Defence Show
Germany Weighs Excluding France from Key European Fighter Jet Programme
Cyberattack Disrupts Check-in and Boarding Systems at Major European Airports
Björn Borg Breaks Silence: Memoir Reveals Addiction, Shame and Cancer Battle
When Extremism Hijacks Idealism: How the Baader-Meinhof Gang Emerged and Fell
JWST Data Brings TRAPPIST-1e Closer to Earth-Like Habitability
Trump Orders $100,000 Fee on H-1B Visas and Launches ‘Gold Card’ Immigration Pathway
France’s Looming Budget Crisis and Political Fracture Raise Fears of Becoming Europe’s “Sick Man”
Three Russian MiG-31 Jets Breach Estonian Airspace in ‘Unprecedentedly Brazen’ NATO Incident
European manufacturers against ban on polluting cars: "The industry may collapse"
Turkish car manufacturer Togg Enters German Market with 5-Star Electric Sedan and SUV to Challenge European EV Brands
Christian Brueckner Released from German Prison after Serving Unrelated Sentence
World’s Longest Direct Flight China Eastern to Launch 29-Hour Shanghai–Buenos Aires Direct Flight via Auckland in December
New OpenAI Study Finds Majority of ChatGPT Use Is Personal, Not Professional
The conservative right spreads westward: a huge achievement for 'Alternative for Germany' in local elections
Pope Leo Warns of Societal Crisis Over Mega-CEO Pay, Citing Tesla’s Proposed Trillion-Dollar Package
Poland Green-Lights NATO Deployment in Response to Major Russian Drone Incursion
U.S. and China Agree on Framework to Shift TikTok to American Ownership
Le Pen Tightens the Pressure on Macron as France Edges Toward Political Breakdown
Czech Republic signs €1.34 billion contract for Leopard 2A8 main battle tanks with delivery from 2028
Penske Media Sues Google Over “AI Overviews,” Claiming It Uses Journalism Without Consent and Destroys Traffic
Indian Student Engineers Propose “Project REBIRTH” to Protect Aircraft from Crashes Using AI, Airbags and Smart Materials
One in Three Europeans Now Uses TikTok, According to the Chinese Tech Giant
Could AI Nursing Robots Help Healthcare Staffing Shortages?
NATO Deploys ‘Eastern Sentry’ After Russian Drones Violate Polish Airspace
The New Life of Novak Djokovic
German police raid AfD lawmaker’s offices in inquiry over Chinese payments
Volkswagen launches aggressive strategy to fend off Chinese challenge in Europe’s EV market
France Erupts in Mass ‘Block Everything’ Protests on New PM’s First Day
Poland Shoots Down Russian Drones in Airspace Violation During Ukraine Attack
Apple Introduces Ultra-Thin iPhone Air, Enhanced 17 Series and New Health-Focused Wearables
Macron Appoints Sébastien Lecornu as Prime Minister Amid Budget Crisis and Political Turmoil
Vatican hosts first Catholic LGBTQ pilgrimage
Apple Unveils iPhone 17 Series, iPhone Air, Apple Watch 11 and More at 'Awe Dropping' Event
France joins Eurozone’s ‘periphery’ as turmoil deepens, say investors
France Faces New Political Crisis, again, as Prime Minister Bayrou Pushed Out
Nayib Bukele Points Out Belgian Hypocrisy as Brussels Considers Sending Army into the Streets
France, at an Impasse, Heads Toward Another Government Collapse
×