HKEX drops £32bn bid for London Stock Exchange
Hong Kong Exchanges and Clearing (HKEX) has dropped its £32 billion offer for the London Stock Exchange (LSE), effectively ending a takeover saga that would have seen the creation of a worldwide capital markets operator and the scuppering of LSE’s Refinitiv buyout.
Few analysts expected the deal to go ahead
The Hong Kong firm states that it was disappointed it had not managed to win over LSE following its statement of intent a month ago.
Charles Li, chief executive of HKEX, admits that the board had concluded the offer was not in the best interests of its shareholders. “We only regret the chances we didn’t take,” he wrote in a blog post.
Last month at Swift’s Sibos industry event, hosted in London, Li went on a charm offensive about the deal, stating that it could turn London into the financial capital of the world for renminbi.
“This great city became a global financial centre because [it] took the dollar and became the dollar centre outside of the United States,” said Li at the time. “In 20 years this city is going to be the RMB centre, it’s going to be the euro centre, it’s going to be the centre of everything.”
Read more: HKEX £32bn bid for LSE faces rejection
LSE responded to the offer from HKEX by reaffirming its commitment to the Refinitiv deal. Also at Sibos was the bourse’s CEO, David Schwimmer, who reiterated the firm’s focus on Shanghai as the new financial centre of China.
LSE is no stranger to mergers and acquisitions. In 2017, EU regulators blocked a £21 billion merger between the LSE and Germany’s Deutsche Boerse. The European Commission said at the time of the deal would have created a “de facto monopoly”.
Back in 2011 the group attempted to merge with Canadian exchange TMX in a deal worth £2.4 billion. Negotiations were scrapped in the summer of that year after the deal failed to gain majority approval from TMX shareholders.
