Budapest Post

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

Hong Kong Exchange Makes Surprise $36.6 Billion Bid for LSE

Hong Kong Exchange Makes Surprise $36.6 Billion Bid for LSE

Hong Kong Exchanges & Clearing Ltd. made an unexpected $36.6 billion bid for London Stock Exchange Group Plc, a bold move that would upend the U.K. bourse’s combination with Refinitiv.

LSE’s board “remains committed to” the acquisition of data provider Refinitiv, highlighting the hurdles facing an offer that it called unsolicited, preliminary and highly conditional. The board said it would consider the proposal and make a further announcement later.

LSE’s shares pared earlier gains, reflecting skepticism that a deal can be done in the face of escalating tensions with China over Hong Kong and the view that the $27 billion takeover of Refinitiv would allow LSE to push into financial data, offering a more secure future than a combination of stock exchanges.

For HKEX, the deal promises a base away from the increasingly fraught political climate at home.

Under the proposal, HKEX would offer 2,045 pence as well as 2.495 newly issued HKEX shares per LSE share. That values each LSE share at 8,361 pence, the Hong Kong bourse said in its statement. The U.K. company’s stock rose 6.2% to 7,190 pence on Wednesday at 10:54 a.m. in London, after earlier surging as much as 16%.

The Asian bourse operator had considered the “ambitious and far-reaching” deal for one of Europe’s largest exchanges for many months, HKEX Chief Executive Officer Charles Li said in a statement Wednesday.

Data Dominance

The Refinitiv deal was a bet by LSE on a future dominated by data, as the three-century-old exchange looks for ways to extend its global reach. Acquiring Refinitiv, the former financial and risk unit of Thomson Reuters, would help the London bourse expand further into data analysis.

An HKEX-LSE pact would put an end to the Refinitiv purchase, instead creating a global trading power that would have stock, derivatives and commodities exchanges, as well as clearinghouses across two continents.

Bloomberg LP, the parent of Bloomberg Intelligence, competes with Refinitiv and Thomson Reuters to provide financial news, data and information.

Both exchange operators have been involved in bourse merger deals in recent years, with LSE failing in its attempt to combine with Deutsche Boerse AG and HKEX acquiring London Metal Exchange in 2012 for 1.4 billion pounds.

LSE’s efforts to merge with Deutsche Boerse were ultimately scuppered by political considerations. HKEX’s proposed move could fall at the same hurdle, said Ronald Wan, chief executive at Partners Capital International Ltd. in Hong Kong.

“A takeover from Hong Kong, a special administrative region of China, could be seen as a takeover from China. It won’t be easy to clear all the regulatory hurdles -- the deal is super politically sensitive,” he said.

U.K. Business Secretary Andrea Leadsom, speaking on Bloomberg Television as news of the deal broke, said the British government would scrutinize any tie-up between the exchanges. Leadsom said the U.K. authorities would “look very carefully at anything that had security implications for the U.K.”

HKEX was created in 2000 after the merger of stock and derivatives exchanges in Hong Kong. The company went public later that year.

Li said earlier this year in the company’s latest strategic plan that HKEX aims to be “globally connected,” while being “China anchored.” In recent years he has tied his business more closely to the Chinese mainland, in particular with the start of stock and bond trading links to markets in Shanghai and Shenzhen.

As well as its iconic stock exchange, LSE runs businesses including the world’s biggest OTC derivatives clearinghouse, LCH Ltd.; index provider FTSE Russell; a European share trading venue called Turquoise; and Borsa Italia.

Hong Kong lawmaker and HKEX shareholder Christopher Cheung said he was concerned most about the offer price, and what LSE could offer to HKEX. Cheung, a veteran broker, said in an interview that he thinks it’s getting harder for HKEX to start more trading links with China, citing the US-China trade tension and the recent protests in the city against growing influence from Beijing.

“If Hong Kong cannot count on itself to maintain its status as an international finance center, it is only natural to seek horizontal, inorganic growth through acquisition,” he said by phone.

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
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
The Country That Got Too Rich? Public Spending Dominates Norway Election
EU Proposes Phasing Out Russian Oil and Gas by End of 2027 to End Energy Dependence
More Than 150,000 Followers for a Fictional Character: The New Influencers Are AI Creations
EU Prepares for War
Trump Threatens Retaliatory Tariffs After EU Imposes €2.95 Billion Fine on Google
Tesla Board Proposes Unprecedented One-Trillion-Dollar Performance Package for Elon Musk
Gold Could Reach Nearly $5,000 if Fed Independence Is Undermined, Goldman Sachs Warns
Uruguay, Colombia and Paraguay Secure Places at 2026 World Cup
Trump Administration Advances Plans to Rebrand Pentagon as Department of War Instead of the Fake Term Department of Defense
Big Tech Executives Laud Trump at White House Dinner, Unveil Massive U.S. Investments
Tether Expands into Gold Sector with Profit-Driven Diversification
‘Looks Like a Wig’: Online Users Express Concern Over Kate Middleton
Florida’s Vaccine Revolution: DeSantis Declares War on Mandates
Trump’s New War – and the ‘Drug Tyrant’ Fearing Invasion: ‘1,200 Missiles Aimed at Us’
"The Situation Has Never Been This Bad": The Fall of PepsiCo
At the Parade in China: Laser Weapons, 'Eagle Strike,' and a Missile Capable of 'Striking Anywhere in the World'
The Fashion Designer Who Became an Italian Symbol: Giorgio Armani Has Died at 91
Putin Celebrates ‘Unprecedentedly High’ Ties with China as Gazprom Seals Power of Siberia-2 Deal
China Unveils New Weapons in Grand Military Parade as Xi Hosts Putin and Kim
Rapper Cardi B Cleared of Liability in Los Angeles Civil Assault Trial
Google Avoids Break-Up in U.S. Antitrust Case as Stocks Rise
Couple celebrates 80th wedding anniversary at assisted living facility in Lancaster
Information Warfare in the Age of AI: How Language Models Become Targets and Tools
The White House on LinkedIn Has Changed Their Profile Picture to Donald Trump
"Insulted the Prophet Muhammad": Woman Burned Alive by Angry Mob in Niger State, Nigeria
Trump Responds to Death Rumors – Announces 'Missile City'
Druzhba Pipeline Incident Sparks Geopolitical Tensions
Cost of Opposition Leader Péter Magyar's Economic Plan Revealed
Germany in Turmoil: Ukrainian Teenage Girl Pushed to Death by Illegal Iraqi Migrant
United Krack down on human rights: Graham Linehan Arrested at Heathrow Over Three X Posts, Hospitalised, Released on Bail with Posting Ban
Asian and Middle Eastern Investors Avoid US Markets
Ray Dalio Warns of US Shift to Autocracy
Eurozone Inflation Rises to 2.1% in August
Russia and China Sign New Gas Pipeline Deal
Von der Leyen's Plane Hit by Suspected Russian GPS Interference in an Incident Believed to Be Caused by Russia or by Pro-Peace or by Anti-Corruption European Activists
China's Robotics Industry Fuels Export Surge
Suntory Chairman Resigns After Police Probe
Gold Price Hits New All-Time Record
UK Fintechs Explore Buying US Banks
Greece Suspends 5% of Schools as Birth Rate Drops
Apollo to Launch $5 Billion Sports Investment Vehicle
Bolsonaro Trial Nears Close Amid US-Brazil Tension
European Banks Push for Lower Cross-Border Barriers
Poland's Offshore Wind Sector Attracts Investors
×