LSE shares lapse after ‘OFT’ probe’s weary wait |
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Tue, 29 Mar 2005 01:00
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London Stock Exchange shares sank with investors preparing themselves for the result of the two-month long probe that had been carried out by the Office of Fair Trading in evaluating the two proposals that intended to acquire the UK bourse.
The outcome is supposed to be announced by the end of this month with OFT declaring its opinions over the two contenders; Deutsche Boerse and Euronext which plan to bring into existence the second-biggest stock exchange in the world, after the New York Stock Exchange.
| Nothing really can be said about what decision the OFT will take. Either of the takeover proposals could be rejected or even levied with certain rules and regulations. In fact, the proposals could also be referred back to the Competition Commission for a profound analysis. If that happened, the already delayed takeover would again be prolonged, probably till summer end before any decision could be arrived at.
Way back in December, Deutsche Boerse had made a cash offer of 530 pence per share in its proposal but LSE had denied Boerse's offer twice which was then followed by Frankfurt exchange shareholders’ complete dismissal of the proposal. Boerse’s opponent, Euronext, however, has not yet made any cash offer.
Deutsche Boerse’s compliance with the OFT in its investigation is being seen as an intelligent move by Boerse, which is considering making new competitive offers in case Euronext or any other rival party comes up with a strong bid.
LSE shares saw a slump of 1.7 percent at 466p in early trade with bleak chances of a fast bid. Deutsche Boerse shares were down 1 percent at 58.9 euros, with Euronext trading down 1.6 percent at 27.45 euros. On the whole, the European market stood at a 0.4 percent low.
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