Hong Kong drops bid for London Stock Exchange

The London Stock Exchange Group had rejected the bid, which it said fell short of a fair valuation.

Hong Kong's stock exchange has dropped its multibillion-dollar bid for the prized London Stock Exchange (LSE).

The bid was worth £32bn ($40bn) and was dependent on the axing of the London exchange's planned purchase of US financial data provider Refinitiv.

But the LSE had rejected the offer, saying it fell "substantially short" of an appropriate valuation.

Hong Kong Exchanges and Clearing (HKEX) said it was now in the interest of shareholders to drop the bid.

In a statement, the board said it still believed a tie-up was "strategically compelling" and "would create a world-leading market infrastructure group".

UK to launch 'groundbreaking' China stock link

HKEX had until Wednesday to follow up its initial takeover proposal with a firm bid.

Under UK rules, it is not allowed to make another approach for the LSE for six months.

"The board of HKEX is disappointed that it has been unable to engage with the management of LSEG in realising this vision," it said in a statement.

Shares in LSE dropped 6% in reaction to the news.

The LSE's board rejected the bid unanimously last month and said it saw "no merit in further engagement".

In a published letter sent to HKEX, the LSE said the bid was "inherently uncertain" because it was mostly in shares, and also because of Hong Kong's questionable future as a strategic gateway.

Neil Wilson, chief market analyst at Markets.com, said investors had "balked at the anti-trust, regulatory and deliverability issues that the tie up implied".

However, he added: "We're slightly surprised HKEX didn't try again - the fact they didn't suggests their charms... were completely lost on the big shareholders.

"[LSE] shares slipped... on the open, but what remains unclear is whether one of the large US exchanges comes in."

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.