Investment firms were distinctly unimpressed by the London Stock Exchange's announcement that it is to work with Lehman Brothers to create a new dark pool trading platform. By mid-afternoon, shares in the UK stock market operator were trading almost 13% lower, giving up gains made the previous day on the back of speculation about a potential predatory bid from the Chicago Mercantile Exchange.

The LSE is coming late to this particular game. Nyse Euronext announced in October that it will team with HSBC and BNP Paribas to establish an electronic block trading platform for European listed stocks called Smartpool; while SWX Europe is close to launching its own non-displayed block trading service for Swiss blue-chip equities in connjunction with US trading technology vendor Nyfix.

The LSE garnered plenty of column inches for its plans, but read the small print and you'll find that the proposals currently amount to little more than vapourware, with a 'strategic advisory committee' and working groups to be operational from Q3 2008.

With launch scheduled for Q1 2009, it seems more than likely that the new service will comprise a rebadged version of Lehman's inhouse dark pool, Liquidity Cross, with a few extra bells and whistles attached.

The new MTF has been christened Baikal, after the Siberian freshwater lake that is reputed to be the deepest in the world. Let's hope all that liquidity hasn't dried up by the time the LSE dips its toes in the water next year.