London Stock Exchange negotiating $27 billion takeover of Refinitiv

London Stock Exchange negotiating $27 billion takeover of Refinitiv

The London Stock Exchange has confirmed that it is in advanced talks to buy financial data vendor Refinitiv.

Under the key headline terms it is expected that LSEG would acquire Refinitiv for a total enterprise value of approximately $27 billion. The parties anticipate that the transaction would result in Refinitiv shareholders Thomson Reuters and Blackstone holding an approximately 37% in the enlarged group and less than 30% of the total voting rights of LSEG.

Refinitiv currently serves over 40,000 customer institutions across 190 countries including buy and sell-side firms, market infrastructure companies, governments, financial technology firms and corporations. Refinitiv’s trading venues business includes a stake in the Tradeweb trading platform and ownership of the FXAll and Matching platforms (coveted by Deutsche Bourse), among others, with average daily trading volume of over US$400 billion in FX and US$500 billion in fixed income.

In a statement explaining the logic behind the deal, LSEG says: "The Board has conviction that a leading financial markets infrastructure provider must operate globally and across asset classes, with data management, analytics and distribution capabilities that can serve customers across asset classes and geographies."

The sentiment has met with market approval, with shares in the London exchange venue leaping by 14% on the news.

An agreement between the two would put the combined group on a par with Bloomberg. Together LSEG and Refinitiv would be the largest listed global financial markets infrastructure provider by revenue, with combined annual revenues of over £6 billion in 2018. In addition, LSEG believes that annual run-rate cost synergies in excess of £350 million would be deliverable in the five years after completion.

Comments: (1)

A Finextra member
A Finextra member 29 July, 2019, 13:29Be the first to give this comment the thumbs up 0 likes

Disclosure - I once worked for Thomson Reuters.  It's my belief that for a vendor like Refinitiv, which uses many services from other exchanges and 3rd party vendors, to be taken over by a major exchange, will lose its ability to act as an independent vendor, and that this combination would be unhealthy for other exchanges.  

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