UPDATE: London Stock Exchange Hails "Milestone" As Refinitiv Deal Done

(Alliance News) - London Stock Exchange Group PLC on Friday confirmed its USD27 billion ...

Alliance News 29 January, 2021 | 1:16PM
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(Alliance News) - London Stock Exchange Group PLC on Friday confirmed its USD27 billion acquisition for financial market data and infrastructure provider Refinitiv has been completed.

Shares in LSEG were 2.0% higher in London on Friday afternoon at 8,562.00 pence each.

Chief Executive David Schwimmer said: "Completion of the acquisition of Refinitiv marks an important milestone in LSEG's history. I am delighted to welcome our new board directors, shareholders, executive management and all the new Refinitiv colleagues joining LSEG.

"This transformational transaction brings together two highly complementary global businesses with a shared commitment to an Open Access philosophy, working in partnership with customers. LSEG is focused on delivering the benefits of the transaction helping customers to access data, trading tools, analytics and risk management across the financial markets and at scale around the globe. LSEG is well positioned for long-term sustainable growth in a rapidly evolving landscape as a leading global financial markets infrastructure and data provider."

Through its market data terminals and trading platforms, including FXAll and Tradweb, Refinitiv serves over 40,000 customer institutions across 190 countries. The Refinitiv data platform has more than 150,000 data sources, providing real-time market pricing, reference data, private and public company information and events, commodity, economic, quantitative and research data, Reuters news and over 10,000 other news sources.

Now that deal is completed, Refinitv's shareholders - Thomson Reuters Corp and a consortium of investments funds affiliated with Blackstone Group Inc - now own about a 37% economic interest and a 29% voting interest in the stock exchange operator.

LSEG's total enlarged share capital - of 463.8 million - has been readmitted to trading on Friday. LSEG also noted it holds 67.4 million shares in treasury.

LSEG first announced its agreement to purchase Refinitiv in July 2019.

Other members of the Blackstone consortium that owned Refinitiv were an affiliate of the Canada Pension Plan Investment Board, an affiliate of GIC Special Investments Pte Ltd, and other co-investors. The group bought a 55% stake in what was then the Thomson Reuters Financial & Risk business in 2018.

Blackstone Senior Managing Director Martin Brand, on Friday, said: "LSEG's combination with Refinitiv creates a global leader in financial data and infrastructure. We are excited to be a long-term partner to LSEG as the company continues to grow and innovate."

As part of the takeover, Thomson Reuters and Blackstone are entitled to nominate three people to LSEG's board - for as long as they hold at least a 25% stake in LSEG

Brand, together with Douglas Steenland, are being appointed as representatives of Blackstone and Erin Brown is being appointed as a representative of Thomson Reuters.

Brand is co-head of US Acquisitions for Blackstone's Private Equity Group. Steenland is a senior advisor in the Blackstone Private Equity Group.

Brown has held a number of senior executive roles at Thomson Reuters and is currently head of finance for the Thomson Reuters Corporates business.

Thomson Reuters shares rose 2.3% to USD81.92 in New York on Thursday. They were flat in pre-market trade Friday.

LSEG in mid-January said the European Commission conditionally approved the deal, after previously raising concerns.

In response to the EC's concerns, the stock exchange and clearing operator agreed to sell Borsa Italiana parent company London Stock Exchange Group Holdings Italia SpA to Euronext for EUR4.33 billion, with the sale receiving approval from LSEG shareholders in November.

LSEG already had received merger control clearances from the relevant authorities in the US, Australia, Canada and the UAE for the acquisition.

While it was trying to secure Refinitiv, LSEG had to ward off interest in itself from Asian peer Hong Kong Exchanges & Clearing Ltd, which lodged a GBP29.6 billion offer for LSEG.

In September 2019, HKEX said the business combination could "create a global market infrastructure leader". HKEX had hoped to show peer LSEG that the acquisition would be much more beneficial to LSEG than the Refinitiv deal.

LSEG rejected the offer from HKEX describing it, at the time, as a bid with "fundamental flaws". The pursuit ended on a sour note, when the London market operator published Chair Don Robert's letter to HKEX, in which he said the firm was "very surprised and disappointed" by the decision to publish the offer proposal only two days after it was received by LSEG.

By Paul McGowan; paulmcgowan@alliancenews.com

Copyright 2021 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Rating
London Stock Exchange Group PLC 7,754.00 GBX 1.73

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