EU approves $27bn LSE takeover of Refinitiv

EU competition regulators have approved the London Stock Exchange Group’s $27 billion all-share takeover of Refinitiv.

A merger of the firms could create a serious competitor to financial data giant Bloomberg LP.

Refinitiv is 45%-owned by Thomson Reuters.

The European Commission had highlighted potential problems ranging from the companies’ combined control of financial data and the effect the deal could have on trading and clearing of bonds and derivatives.

The EC said its investigation found a number of concerns about the deal but these concerns would be addressed by “remedies”, including the sale of LSE’s Borsa Italiana.

“Infrastructure competition in trading services and access to financial data products on fair and equal terms is essential for the European economy and in particular for consumers and businesses,” said European Commission executive vice-president Margrethe Vestager, in charge of competition policy.

“Today, we can approve the proposed acquisition of Refinitiv by LSEG because LSEG offered commitments that will ensure that the markets will remain open and competitive and the acquisition will not lead to higher prices or less choice and innovation for these products.”

The transaction remains subject to a small number of merger control and financial regulatory authority approvals and is expected to complete shortly in Q1 2021.

The EC said: “The Commission’s investigation focused on trading services for European Governments Bonds (EGBs), where both parties are active, as well as on the provision of financial data products and the provision of trading and clearing services for over-the-counter interest rate derivatives (OTC IRDs), where one party is active upstream of the other in the value chain …

““The commitments offered by LSEG fully address the competition concerns raised by the proposed transaction.

“The Commission therefore concluded that the transaction, as modified by the commitments, would no longer raise competition concerns.”

The approval of the deal is conditional on full compliance with the commitments package offered by LSEG.

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Mark McSherry
Dalriada Media LLC sites are edited by veteran news journalist Mark McSherry, a former staff editor and reporter with Reuters, Bloomberg and major newspapers including the South China Morning Post, London's Sunday Times and The Scotsman. McSherry's journalism has also appeared in The Washington Post, The Guardian, The Independent, The New York Times, London's Evening Standard and Forbes. McSherry is also a professor of journalism and communication arts in universities and colleges in New York City. Scottish-born McSherry has an MBA from the University of Edinburgh and a Certificate in Global Affairs from New York University.