London Exchange rejects Hong Kong’s surprise takeover bid in strongly worded endorsement of Shanghai as ‘preferred partner’
- LSE cites Hong Kong’s current political crisis, and questions its future role as a gateway to China in strongly worded letter rejecting the offer
- The UK-based bourse said it remained committed to its proposed purchase of Refinitiv
The London Stock Exchange has rebuffed Hong Kong’s unsolicited takeover bid in a strongly worded letter and separate website post spelling out its concerns about the “fundamental flaws” of the plan, which included the current political crisis engulfing the city.
The UK bourse’s board of directors said it had unanimously rejected the US$36.6 billion proposal from Hong Kong Exchanges and Clearing, which surprised the market when it was announced earlier this week.
In a letter to the chairman and chief executive of Hong Kong Exchanges and Clearing, LSE chairman Don Robert pulled no punches, making clear his preference for Shanghai over Hong Kong as a strategic partner.
“We do not believe HKEX provides us with the best long-term positioning in Asia or the best listing/ trading platform for China. We value our mutually beneficial partnership with the Shanghai Stock Exchange which is our preferred and direct channel to access the many opportunities with China,” it said.
He was referring to LSE’s existing stock connect scheme with Shanghai Stock Exchange, which he said gives it direct access to China.
A statement posted on the LSE website on Friday said: “The board has fundamental concerns about the key aspects of the conditional proposal: strategy, deliverability, form of consideration and value,” said a statement posted on the LSE website on Friday, just two days after the local bourse made the unexpected offer.
