Hong Kong stock exchange share price dips in wake of £32bn offer for LSE
The Hong Kong stock exchange’s share price dipped this morning as investors reacted to the group’s shock £32bn offer for its London counterpart.
Shares in Hong Kong Exchanges and Clearing (HKEX) fell 3.5 per cent during trading today, underlining doubts in the market over the unprecedented bid to buy the LSE and “redefine global capital markets for decades to come”.
Read more: Hong Kong’s bid for the LSE whips up a storm
Several attempts to merge the LSE with an international rival have fallen short in recent years, with plans for a tie-up with Deutsche Boerse in 2017 being blocked by EU regulators.
Questions over regulatory scrutiny and government hurdles have mounted since the proposal was announced yesterday morning.
A number of leading politicians in the UK have raised concerns over the move in the wake of anti-government demonstrations in Hong Kong that have shed light on the city’s relationship with mainland China.
Read more: Could the HKEX offer actually succeed?
The deal, which would torpedo the LSE’s own takeover plans to acquire data provider Refinitiv, has also sparked speculation of a possible alternative bid from the US.
One City figure involved in the LSE’s failed merger talks with Deutsche Boerse two years ago said last night: “HKEX has wanted to buy LSE for years and clearly the Refinitiv deal has made them feel forced to move now…but now is not a great time for them.
“ICE and CME will be watching this very very closely indeed. The Americans will not be comfortable with the prospect of the LSE being owned by HKEX, especially when the majority of LSE customers are big US investment banks.”