HKEX drops takeover bid for London peer

HKEX drops takeover bid for London peer

Hong Kong's bourse said on Tuesday it has dropped its $39 billion bid to take over London Stock Exchange Group (LSE), saying it had been unable to bring the takeover target's management on board with its unsolicited approach.

The London Stock Exchange Group rejected the offer the next day, however, citing "fundamental flaws" and alleging ties to the Hong Kong government.

Specifically, HKEX confirmed that it does not intend to make an offer for LSEG, however, the Board of the company still believes that the merger between LSEG and HKEX is "strategically compelling and would create a world-leading market infrastructure group".

"HKEX is disappointed that it has been unable to engage with the management (of the London Stock Exchange) in realizing this vision", it said.

"The price tag from the Hong Kong exchange perspective was getting a bit too high, so it's good for the shareholders that they chose to walk away", said Hao Hong, head of research at broker BOCOM International. Refinitiv is 45%-owned by Thomson Reuters TRI.TO which owns Reuters News.

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The London Stock Exchange could not immediatelybe reached for comment.

Li said the HKEX would not ease its global pace after giving up the bid.

In its statement, HKEX said it was "disappointed" to pull its bid, but added that it was in the best interests of shareholders to do so.

The bid was made against a backdrop of increasingly violent protests in Hong Kong, a former British colony that came under Beijing's rule in 1997.

Shares in the LSE plunged by over 6% in early trading after the bid withdrawal. "If that deal fails then HKEX will be there".

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