London Stock Exchange share price: Group and Deutsche Börse to flag $7bn in savings

October 21, 2019

London Stock Exchange Group (LON:LSE) and Deutsche Börse are set to promise up to $7 billion in efficiency savings on trading in an effort to secure investor support for their planned tie-up, the Financial Times has reported. The news comes with Intercontinental Exchange currently mulling a counter bid for the UK group.

London Stock Exchange’s share price has slipped into the red in today’s session, having lost 0.56 percent to 2,820.00p as of 13:14 GMT. The decline is largely in line with losses in the broader market, with the FTSE 100 index currently standing 0.43 percent lower at 6,155.97 points.
People with knowledge of the matter told the FT today that LSE and Deutsche Börse were set to highlight the benefits of allowing customers to offset the capital requirements of overlapping trades currently housed at rival exchanges. Proponents of the merger believe that it would generate capital savings of between $5 billion and $7 billion by “compressing” the requirements for trades which currently attract duplicate regulatory capital.

LSE and Deutsche Börse announced last month that they had entered talks about an all-share merger set to create a £20-billion entity. The tie-up deal would also give customers a one-stop shop for primary markets in London, Frankfurt and Milan, and bring the Euro Stoxx 50 Index and FTSE Russell’s portfolio of indexes under the same roof.
LSE’s shareholders, however, are now waiting to see the full details of synergy benefits from Deutsche Börse’s proposal before taking a view on the merits the deal versus a potential rival offer which could come from Intercontinental Exchange. The NYSE-owner confirmed last week that it was exploring a counter bid for the UK group.
As of 13:47 GMT, Tuesday, 08 March, London Stock Exchange Group Plc share price is 2,818.00p.