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Hong Kong exchange falls over 3% after $39 billion takeover bid for LSE


Added 09-11-19 10:03:02pm EST - “Hong Kong Exchanges and Clearing Ltd (HKEX) <0388.HK> shares fell more than 3% o...” - Reuters.com

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Posted By TheNewsCommenter: From Reuters.com: “Hong Kong exchange falls over 3% after $39 billion takeover bid for...”. Below is an excerpt from the article.

HONG KONG (Reuters) - Hong Kong Exchanges and Clearing Ltd (HKEX) (0388.HK) shares fell more than 3% on Thursday after the bourse unveiled a $39 billion takeover approach to the London Stock Exchange Plc (LSE) (LSE.L) on Wednesday.

HKEX shares fell as much as 3.7% in opening deals, while the benchmark Hang Seng Index .HSI was up 0.1%, suggesting investors are concerned about the financial merits of the deal.

The proposed deal is aimed at creating a combined group better able to compete with U.S. rivals such as Intercontinental Exchange Inc (ICE.N) and CME Group inc (CME.O). It is contingent on LSE abandoning a deal to acquire financial information provider Refinitiv.

HKEX, whose main shareholder is the Hong Kong government, said its 31.6 billion pound ($38.97 billion) cash-and-share transaction proposal represented a 22.9% premium to the LSE’s closing stock price on Tuesday of 8,361 pence.

The Hong Kong exchange’s bid is considered a bet that a major international acquisition would help it overcome uncertainty at home.

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