German prosecutors probe share purchase by Deutsche Boerse boss before London Stock Exchange merger deal
German authorities are investigating a share purchase by Deutsche Boerse’s chief executive shortly before the company announced its plans to merge with the London Stock Exchange.
The German exchange announced on Wednesday evening that the public prosecutor’s office of Frankfurt was investigating the share purchase by Carsten Kengeter, made on 14 December 2015.
Shares in Deutsche Boerse were down 1.5 per cent this morning, while shares in the London Stock Exchange Group dipped by one per cent.
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Deutsche Boerse chairman Joachim Faber described "accusations as groundless".
And the London Stock Exchange Group issued a statement this morning saying:
LSEG welcomes the strong statement of support by Joachim Faber, chairman of the supervisory board of Deutsche Boerse who has described the allegations related to Carsten Kengeter as without foundation. We look forward to working towards completion of our proposed merger.
Kengeter bought 60,000 shares worth around €4.5m (£3.8m) in three transactions on this day.
The purchase was part of the “executive board’s remuneration programme as approved by the supervisory board”, Deutsche Boerse said in a statement.
A couple of months later, it emerged that Deutsche Boerse was in talks to merge with the London Stock Exchange, and the companies agreed a deal in March.
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Deutsche Boerse’s shares are up 11 per cent since the Kengeter purchase.
Under the terms of the deal, if the merger completes, Kengeter will become chief executive of the joint company.