Sunday, September 4, 2011

London Stock Exchange in talks to buy LCH.Clearnet

The London Stock Exchange (LSE) has said it is in early talks to buy Europe's last remaining independent clearing house.

LCH.Clearnet helps settle financial transactions between investors, including share sales on the LSE.

"[LSE] can confirm that it is currently in discussions with LCH.Clearnet regarding a potential transaction," the exchange said in an official statement.

It said talks were at an early stage with no certain outcome.

The short statement was put out in response to a report by the Financial Times overnight that talks were taking place.

The bid is worth 1bn euros (£880m, $1.4bn), according to the report.

LCH.Clearnet first reported three months ago that it had received interest from potential suitors.

Possible rivals to the LSE are thought to include Nasdaq OMX - the owner of the US technology and Swedish stock exchanges - and the data firm Markit, who produce closely-watched international industry surveys.

Other stock exchanges typically own the clearing house that handles transactions in the shares that they list.

The LSE already owns another clearing house - CC&G in Italy - by virtue of its takeover of the Milan stock exchange in 2007.

The move by the LSE follows the collapse earlier in the summer of its planned acquisition of TMX, the firm that owns the Toronto Stock Exchange, in the face of strong opposition from the Canadian financial community.