Shareholders green light 60 percent stake move.
The London Stock Exchange Group (LSE) has received preliminary shareholder approval from LCH.Clearnet for its takeover bid proposed last month.
The LSE's offer from 9 March 2012 received a majority approval from 60 percent of LCH.Clearnet's shareholders, and an overwhelming majority of proxy votes. Although the acceptance condition has been met, however, the offer will be extended until 13 April 2012 to allow remaining shareholders to participate.
Under the terms of the offer, the LSE will assume ownership of 60 percent of shares in LCH.Clearnet, in a deal valued at around £387 million (approximately $621 million).
The incorporation of a clearing house is being seen as a crucial aspect of strategy for exchanges moving forward, given regulatory reform of over-the-counter markets, and central clearing of standardized derivatives being mandated as a result. Recently, NYSE Euronext announced that it would be terminating elements of its clearing relationship with LCH.Clearnet, instead establishing its own clearing arm.
The completion of the deal is expected by the fourth quarter of 2012.
James talks about his trip to Chicago and some of the interesting topics that came up (including a look at disaster recovery demands). Then Anthony and James touch on ISDA's initial margin rules, with Phase 3 going live next year.Subscribe to Weekly Wrap emails