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London Stock Exchange shareholders vote for Deutsche Boerse merger - but problems remain

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London Stock Exchange shareholders vote for Deutsche Boerse merger - but problems remain

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Another Brexit related conundrum – what to do about the proposed merger between the London Stock Exchange and Germany’s Deutsche Boerse?

On Monday 99.89 percent of the London shareholders voted in favour even though that deal has been thrown into doubt by Britain’s vote to leave the European Union.

London Stock Exchange Group Chairman Donald Brydon said Britain would remain in the EU for at least another two years, during which there was ample time to work out the “optimal structure” for the deal adding that he is confident about it getting approval from EU regulators.

In Frankfurt, Baader Bank’s Head of Capital Markets Analysis, Robert Halver, said: “There’s an affectionate relationship between Frankfurt and London. They want to come together. But there are legal uncertainties. It makes no sense for the headquarters to be in London now, so they could say: ‘We’ll merge and Frankfurt will have the top chair, but, in case Britain remains in the EU, there’ll be a second chair so there could be a reasonable outcome’. Anyway, the main thing is, Frankfurt remains the senior partner.”

Last week, the German financial markets regulator, BaFin, said it was hard to see how the head office of the merged group could still be in London given that Britain was leaving the EU.

Deutsche Boerse shareholders get their say on the merger in a postal vote that closes on 12 July.

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