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Nasdaq makes £2.7bn offer for LSE | Nasdaq makes £2.7bn offer for LSE |
(20 minutes later) | |
A takeover offer worth £2.7bn ($5.1bn) has been tabled for the London Stock Exchange (LSE) by the US Nasdaq market. | A takeover offer worth £2.7bn ($5.1bn) has been tabled for the London Stock Exchange (LSE) by the US Nasdaq market. |
Under the deal Nasdaq, which already owns more than 25% of the LSE's stock, said it would pay 1243 pence per share. | Under the deal Nasdaq, which already owns more than 25% of the LSE's stock, said it would pay 1243 pence per share. |
Shares in the London market have surged more that 124% over the past year amid ongoing speculation that it will be subject to a takeover offer. | Shares in the London market have surged more that 124% over the past year amid ongoing speculation that it will be subject to a takeover offer. |
A number of foreign suitors, including the New York Stock Exchange, have approached it in recent months. | A number of foreign suitors, including the New York Stock Exchange, have approached it in recent months. |
In a statement, Nasdaq said it planned a dual listing in London and New York if its offer is successful. | |
'Final offer' | |
"We are excited about the prospect of combining two strong businesses to form the leading global, cross-border equity market platform giving issuers the ability to dual-list simultaneously in London and New York," said Nasdaq president and chief executive Robert Greifeld. | |
"The combined entity will be well positioned to lead further consolidation and compete effectively for the benefit of all market users." | |
Nasdaq said it would not be revising its "final offer" unless another company decided to make a bid for the London market. | |
The bid is Nasdaq's second attempt at taking over the firm. | |
In March, it dropped a proposed £2.43bn ($4.2bn) bid for the exchange after the LSE rejected its advance. | |
The US firm is the latest in a long line of foreign suitors to approach the London market. | |
German market Deutsche Boerse, Australian investment bank Macquarie and the pan-European exchange Euronext have all abandoned offers for LSE since December 2004. | |
Regulatory worries | |
The approaches have prompted the UK watchdog to voice concern about a foreign takeover as it could lead to regulatory changes. | |
Nasdaq attempted to ease these concerns with its offer saying that the UK exchange would continue to be regulated solely by the UK's Financial Services Authority. | |
Meanwhile, the LSE has resisted approaches saying that it can continue to grow alone. | Meanwhile, the LSE has resisted approaches saying that it can continue to grow alone. |
Earlier this year, LSE chief executive Clara Furse said the company would not do a deal for the sake of doing a deal. | Earlier this year, LSE chief executive Clara Furse said the company would not do a deal for the sake of doing a deal. |
But analysts and market observers have speculated that the Nasdaq is in a strong position and stock exchanges will need to merge if they want to keep on growing and offer a wide-range of global financial services. | |
Last month, City leaders warned that the LSE risked losing its dominant market position in the face of growing global competition. |