London Stock Exchange Group shares surge on Refinitiv takeover talks
Investors gave the £22bn deal an initial thumbs-up.
Shares in London Stock Exchange Group surged 15% higher on Monday after it confirmed talks to acquire data vendor Refinitiv, in a move that would create a financial information giant.
Under the terms of the possible deal, LSE Group would acquire Refinitiv, which makes the Eikon software, for 27 billion US dollars (£21.94 billion).
Refinitiv is jointly owned by private equity giant Blackstone and media firm Thomson Reuters.
The acquisition would leave them with a combined stake of 37% in the enlarged group, and less than 30% of total voting rights.
Shares in London Stock Exchange Group were up 15% at lunchtime on Monday, trading at 6,523p.
While the group said there could be no certainty that the deal would go ahead, it said the tie-up would “offer significant customer benefits”.
“The combined business would create a leading, UK-headquartered, global financial market infrastructure provider with significant multi-asset capital markets capabilities, a leading data and analytics business and a broad post-trade offering, well positioned for future growth in an evolving landscape,” the company said in a statement.
Russ Mould, investment director at AJ Bell, said the announcement fulfilled long-awaited anticipation from investors that LSE Group’s new chief executive David Schwimmer would look to make his mark with an acquisition.
“Buying Refinitiv would not be a wild-card move; in fact, there is a lot of merit to bolting the two companies together,” he said.
“It would provide London Stock Exchange with a significantly stronger position in the field of data.
“The big challenge is to clear any competition authority hurdles and convince shareholders that it isn’t overpaying for the deal. The share price jump on the news would suggest that investors have initially given a big thumbs-up to the proposed deal.”