London Stock Exchange takeover of Refinitiv steps closer as Euronext bids for its Borsa Italiana arm
The London Stock Exchange’s blockbuster $27 billion takeover of data group Refinitiv took a step closer today as Euronext today confirmed it was in talks for a joint takeover bid for the London group’s $4 billion Italian business, Borsa Italiana.
Such a move could convince competition regulators that the LSE’s bid for Refinitiv should be given the green light.
Reports last month had suggested the Euronext consortium was bidding for the bond trading platform of the Borsa, but in today’s statement, the European exchanges group said that, along with the state-backed Italian lender Cassa Depositi e Prestiti, it was in discussions to buy the whole thing.
Speculation has put the sale of the Italian business at about $4 billion.
Rival bids have also been rumoured from Deutsche Boerse and Swiss exchange owner SIX Group, but the Euronext confirmation ups the ante.
“Euronext confirms it is currently in discussions with Cassa Depositi e Prestiti (“CDP”) to submit an offer to London Stock Exchange Group plc for the acquisition of the business and key operational assets of Borsa Italiana,” the exchange said in a brief statement.
A sale of the division could assuage European monopoly watchdogs concerned that the combined LSE-Refinitiv could see the group’s customers given preferential access to critical data used in global markets. The regulators also have concerns about overlaps in sovereign bond trading and derivatives, both of which could be eased by a disposal of the Borsa.
The Borsa owns MTS, a platform used to trade government bonds,
The Borsa sale is a big deal for the LSE; its operations generated about 14% of the company’s earnings last year and is a key entry point for the LSE into Europe post-Brexit.
The LSE first confirmed it was exploring a sale in July.