Hong Kong exchange considers higher bid for LSE


The Hong Kong stock exchange operator Hong Kong Exchanges and Clearing (HKEX) is considering making a higher offer on the London Stock Exchange (LSE). That writes the British newspaper The Times. HKEX made an offer for its London counterpart early last month.

HKEX’s bid of £ 29.6 billion, more than € 33 billion, received conditional support from a number of key shareholders. They indicated that the 83.61 pounds offered per share were not considered sufficient, but that they took a bid of 90 to 100 pounds per share seriously. That would mean that the total bid amounted to between £ 31.8 billion and £ 35.4 billion. Moreover, HKEX would like to pay a larger share of the acquisition sum in cash.

The higher bid should come early next week. According to UK stock market rules, HKEX has until Wednesday to make a formal offer for LSE. Moreover, the offer must be received before the London stock exchange operator can complete the acquisition of Refinitiv, the former data branch of Thomson Reuters. HKEX wants LSE to abandon that acquisition as part of its bid.

Negative reactions

After the first bid, there was a negative response from various sides. Not only did LSE reject the bid, but the British, Chinese and Italian authorities were also critical. The British and Italian, where LSE owns a majority stake in the Milan stock exchange, because they see HKEX as a Chinese company. On the contrary, the Chinese authorities are critical of Hong Kong and want to protect the links of the London stock exchange with those in Shanghai.

HKEX already owns the London Metal Exchange metal exchange in London.

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Oliver I. Kjeldsen

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