Buoyed by the refusal of shareholders to lift a 4.9 per cent restriction on share ownership, the London Stock Exchange has published its third defence document in response to OM Gruppen's unwelcome takeover bid.
Don Cruickshank, chairman of the London Stock Exchange, says: "Despite the revised terms of OM's Offer, the Board of the London Stock Exchange continues to advise its shareholders to reject the offer on the basis that it represents inadequate value. For customers, OM's proposal still offers no proven benefits."
The LSE's rearguard action has been further strengthened by an overnight halt in share trading on the OM-run Swedish stock exchange. OM blamed the two-hour delay in trading on problems at telecommunications operator MCI WorldCom. The glitch came at an embarrassing time for the Swedish group, which has threatened to report the LSE to the Takeover Panel in the wake of recent angry exchanges over the relative merits of their respective trading systems.
In its defence, the London Stock Exchange says it will develop its business by expanding its service offering, product range, and geographical reach. The exchange promises to continue the development of its core trading systems through enhancements such as UK central counterparty, and to look for opportunities to expand in the e-commerce and business-to-business markets. The exchange says it will further look to develop AIM and techMARK as international markets.
At a meeting of shareholders today, LSE members voted to retain a 4.9 per cent limit on the size of stake a single investor can own. The ruling effectively blocks any unwanted takeover bid which fails to win the backing of a 75 per cent majority of shareholders.