LSE takeover can go ahead, but with conditions

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LSE takeover can go ahead, but with conditions

LSE takeover can go ahead, but with conditions
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Britain’s Competition Commission has cleared the way for a formal takeover bid for the London Stock Exchange.

That follows a seven-month long inquiry after the pan European bourse operator Euronext and Frankfurt based Deutsche Börse both said they wanted to buy the LSE.

The Competition Commission has decided that to do that they would have to ensure the independence of the London exchange’s clearing house activities and not obstruct access to them from any potential competitor.

Euronext, which is seen as the front runner, responded that it will “review the contents of the Commission’s report and analyse the potential economic impact of those undertakings.”

The LSE is Europe’s largest equities market, trading shares of more than 3,000 companies.

Analysts say that the winner of the battle to link up with London will have built enough critical mass to attract smaller exchanges and become Europe’s dominant stock market.

Deutsche Börse was the first to try to buy the LSE, but it was forced to withdraw after a large number of its shareholders refused to support the bid.

The Frankfurt exchange has said it might re-enter the race if Euronext makes an offer. But the conditions imposed by the UK competition authority make it less attractive to the Germans.

And others may now be interested. Australia’s Macquarie Bank says it would like to join a consortium to pursue an all-cash bid for the LSE.