Today the British market undertaking is expensive

The Nasdaq launch the assault of the London Stock Exchange (LSE) The question probably taps the minds of the leaders of the London stock market since a few hours now. Because the Nasdaq is now able to go on the offensive. The choice, made on March 30, to withdraw its offer issued then to 950 pence the forced to a period of paralysis for six months, unless a recommendation on the part of the Board of Directors of the coveted company. This period coming to an end. Tomorrow, if he wishes to, the Nasdaq can launch a hostile offer.

Defection of shareholders

The withdrawal of its offer in the spring has not prevented Robert Greifeld, the pattern of the Nasdaq, to pursue his stalking the British financial market. While she imagined supported by its major shareholders, Clara Furse, Executive Director of the LSE, had the bad surprise found last April, the defection of some of them, including Threadneedle, to the benefit of the Nasdaq, which had then 15 of the capital. In may, the American strengthened, to 25.1 of the capital. A serious option at the time where the Nyse is an attempt in Europe, in close of Euronext.

This raises the question of funding. Today, the British market undertaking is expensive. Its action is exchanged Friday around 1.230 pence, or a total market value of 2,657 billion pounds sterling. And, as a first step, Nasdaq may make an offer for a free price. The regulations imposed during the next six months to offer to the shareholders of the LSE an equivalent price or higher than that he has already offered to management companies, the threshold to 1.243 pence. In other words, the Nasdaq should pay the equivalent of 2.01 billion. Unless a supply of paper.

When it had launched its offer on Instinet (to not repeat that the electronic platform Inet), the Nasdaq was allied to Americans, Silver Lake Partners and Hellman & Friedman, funds in exchange for convertible bonds into shares Nasdaq.

Another difficulty, any initiative should remain hostile. The direction of the LSE has indicated repeatedly that she felt his way of independently. "We will let our objectives not be undermined by any transaction thoughtless, defensive or because it is fashionable", said last July even Chris Gibson-Smith, President of the institution. Last Thursday, the Group once more attempted to prove his performance by publishing a review of its activity for the first five months of its fiscal year.

Several strategic options

And rumours from good train in recent weeks about the LSE action, the Group coveted said "several strategic options." ICAP, the world first intermediate in financial products, reported last week have held negotiations on a possible merger, but they were interrupted. His boss, Michael Spencer, allegedly threw the towel before the price of the LSE.

Rest then the strategic option of the time: pending still six months, the Nasdaq is free of its obligations in terms of price leaving mounting pressure on the LSE. This alternative would be the most likely near the record source.

In any event, the City is prepared. After the concerns expressed by the regulator on the consequences of a US property of the London Stock Exchange, the Ministry of Finance announced in mid-September that the powers of the Financial Services Authority (FSA) would be reinforced by legislation. "The interest of the Government on this subject is specific and clear: it is to preserve low level and balanced regulation mode which made London a magnet for international finance", explained then one of the officials of the Ministry, Ed Balls.