OM Group has increased the size of its bid for the London Stock Exchange, offering more shares, cash, and the promise of a greater say for shareholders in the future management of the Exchange.
The increased offer comprises: 1.4 new OM shares for each LSE share, valuing each LSE share at £35.83; or a majority cash alternative giving £20 in cash and 0.5 new OM shares for each LSE share, valuing each LSE Share at £32.79. Under the new deal, LSE Shareholders could own up to 33 per cent of the enlarged OM Group.
Per Larsson, president and chief executive officer of OM, comments: "LSE lacks the culture, commercial management and internal technology resources to make necessary fundamental changes. It is now up to shareholders to decide to equip LSE with the means to compete. A change to commercial ownership and management is required."
The revised bid puts a price tag of more than £1 billion on the LSE. Angela Knight, Chief Executive of the Association of Private Client Investment Managers, which collectively hold 30 per cent of LSE stock, remains unconvinced. "This increased offer for OM will only be of interest to the few shareholders who are looking at price alone. Our member firms are wanting lower trading, clearing and settlement costs for European and US shares. Today's price hike by OM does not bring this to the party."