Hong Kong bourse pulls plug on $39 billion London Stock Exchange bid. More here:
HONG KONG - Hong Kong’s bourse has scrapped its unsolicited $39 billion approach for London Stock Exchange Group after failing to convince LSE management and investors to back a move that could have transformed both global financial services giants.
HKEX chief executive Charles Li wrote in a blog post: “We still believe the strategic rationale for the combination of our two businesses is compelling and would create a world-leading market infrastructure group.” Analysts had viewed HKEX’s chance of success as slim after it was rejected by the LSE just two days from the HKEX going public with its interest. Political turmoil engulfing Hong Kong and perceptions of Beijing’s growing influence over the city, were seen as another key obstacle to any deal.
“The price tag from the Hong Kong exchange perspective was getting a bit too high, so it’s good for the shareholders that they decided to walk away,” said Hao Hong, head of research at broker BOCOM International. “HKEX will continue to try other things. Charles Li has done a lot of deals, most notably the London Metal Exchange. It may not be a stock exchange, but other related areas,” said Bocom’s Hong.
“If the Refinitiv deal surprisingly fails to get approval, I think we could see HKEX come again,” said China Galaxy Securities analyst Chi Man Wong.
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