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Boardroom backing for Deutsche Borse boss over share purchase

The boss of Deutsche Borse has received the backing of the group's supervisory board as he faces a probe into alleged insider dealing that threatens to derail its £21 billion merger with London Stock Exchange Group.

The German exchange said its supervisory board "unanimously expresses its full confidence" in Carsten Kengeter following an emergency meeting called on Monday.

The Frankfurt-based group said an investigation by German prosecutors, who are looking into a share transaction by Mr Kengeter in December 2015, was discussed "thoroughly and intensely".

"These discussions were preceded by extensive conversations with external experts and a renewed analysis of the processes in the year 2015.

"This assessment resulted in the joint finding that no merger negotiations with the LSEG have taken place in the year 2015," Deutsche Borse said.

The supervisory board consists of chairman Joachim Faber and his deputy Richard Berliand, amongst others.

Prosecutors are probing a 4.5 million euro (£3.8 million) share purchase by Mr Kengeter on December 14 2015.

In February 2016, Deutsche Borse and the London Stock Exchange revealed their proposed merger, which subsequently sent their shares rocketing.

To compound matters, a German state finance minister is urging the LSE and Deutsche Borse to base their combined headquarters in Frankfurt rather than the UK in light of Brexit.

The terms of the tie-up say London will be the entity's home, but Britain's divorce from the EU has raised questions over those plans.

Separately, the two groups have formally submitted plans to the European Commission that aim to see off anti-trust concerns.

The London Stock Exchange (LSE) has proposed to offload its French clearing business LCH to Euronext for 510 million euro (£434 million) to smooth the passage of the deal.

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