Nasdaq secures 15% LSE stake
Nasdaq secures 15% LSE stake
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Wednesday, 12, Apr 2006 11:00
New York bourse Nasdaq has become the London Stock Exchange's (LSE) largest single shareholder after acquiring a 14.99 per cent stake in the UK market.
The US exchange, which earlier this year had a £2.4 billion offer for LSE rejected, announced last night that it had agreed a £447.7 million deal with asset management group Threadneedle and a number of other LSE shareholders for more than 38 million shares.
The deal values LSE at 1,175p per share, well above Nasdaq's 950p per share offer last month, and will fuel speculation about an imminent full takeover bid at the higher price.
Nasdaq's move sent LSE shares soaring on early trading this morning, rising by more than 15 per cent before falling back slightly to 1186p at 10:00 BST, up 147.50p on the day.
LSE shares have increased by more than 150 per cent over the past year as a result of sustained takeover speculation surrounding a number of foreign exchanges, including Euronext, Deutsche Borse and the New York Stock Exchange.
Earlier this month, Nasdaq tabled an initial 950p per share offer for LSE, valuing the London exchange at £2.4 billion, a proposition rejected by the LSE board.
Media reports had suggested that the US exchange had since held talks with key LSE shareholders and was mulling over a possible hostile move for the London bourse.
However, in a statement today, Nasdaq ruled out a further approach for the time being, although it left the door open for the possibility of a fresh bid in the future.
The move has come as something of a surprise as, just a fortnight ago, Nasdaq announced that it no longer intended to make an offer for LSE following the rejection of its initial bid.
LSE boardmembers have consistently stressed their determination to maintain their independence, with chief executive Clara Furse insisting last month that business was going "from strength to strength".
However, an improved offer from Nasdaq in line with today's valuation would represent a severe test of Ms Furse's resolve.