LSE receives surprise £31.6bn takeover bid from Hong Kong rival

LONDON: Hong Kong Exchanges and Clearing has launched a shock £31.6 billion bid for the London Stock Exchange Group in a move set to disrupt its UK rival’s tie-up with Refinitiv.

Shares in the London Stock Exchange (LSE) initially surged as much as 16 per cent higher after news of the cash-and-shares approach, but soon pared back gains to stand 6 per cent higher amid investor doubts over the success of the deal.

Hong Kong Exchanges and Clearing (HKEX) is proposing to pay around £83.61 a share — which values the LSE at about £29.6 billion, or £31.6 billion including debt. But HKEX said the potential offer is dependent on LSE’s planned 27 billion US dollars (£21.9 billion) deal to buy data provider Refinitiv being scrapped.

The LSE agreed the Refinitiv deal last month, which would see major Refinitiv shareholders, including Blackstone and Thomson Reuters, take a 37 per cent stake in the enlarged company. HKEX insisted its bid was not hostile and likened its move to snap up the LSE as a “corporate Romeo and Juliet” story.

Charles Li, chief executive of HKEX, said: “It’s an open expression of our admiration of the City of London and the London Stock Exchange.” The company said it has had “early engagement” with the LSE and plans to seek a recommendation from its board.