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Hong Kong Exchanges drops $39 bln offer for LSE

Hong Kong Exchanges and Clearing Ltd said Oct. 8 that it does not intend to go forward with its $39 billion offer for the London Stock Exchange. The HKEX said its board “is disappointed that it has been unable to engage with the management of LSEG in realising this vision, and as a consequence has decided it is not in the best interests of HKEX shareholders to pursue this proposal.”

PRESS RELEASE

NOT TO PROCEED WITH THE OFFER FOR LONDON STOCK EXCHANGE GROUP PLC

This announcement is published pursuant to Part XIVA of the Securities and Futures Ordinance and Rule 13.09 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.

Reference is made to the announcements of Hong Kong Exchanges and Clearing Limited (HKEX) dated 11 September 2019 and 13 September 2019 in relation to its possible offer for London Stock Exchange Group plc (LSEG).

HKEX today released the attached announcement in the United Kingdom to announce it does not intend to make an offer for LSEG.

HKEX’s shareholders and potential investors should exercise caution when dealing or investing in HKEX’s shares.
By Order of the Board
Hong Kong Exchanges and Clearing Limited
Joseph Mau Group
Company Secretary
Hong Kong, 8 October 2019
As at the date of this announcement, HKEX’s Board of Directors comprises 11 Independent Non-executive Directors, namely Mrs Laura May-Lung CHA (Chairman), Mr Apurv BAGRI, Mr CHAN Tze Ching, Ignatius, Mr CHEAH Cheng Hye, Ms FUNG Yuen Mei, Anita, Mr Rafael GIL-TIENDA, Dr HU Zuliu, Fred, Mr HUNG Pi Cheng, Benjamin, Mr LEUNG Pak Hon, Hugo, Mr John Mackay McCulloch WILLIAMSON and Mr YIU Kin Wah, Stephen, and one Executive Director, Mr LI Xiaojia, Charles, who is also the Chief Executive of HKEX.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION
THIS IS AN ANNOUNCEMENT FALLING UNDER RULE 2.8 OF THE CITY CODE ON TAKEOVERS AND MERGERS (THE “CODE”)
FOR IMMEDIATE RELEASE
8 October 2019
Statement regarding London Stock Exchange Group plc
Further to the announcements made by Hong Kong Exchanges and Clearing Limited (“HKEX”) and London Stock Exchange Group plc (“LSEG”) in relation to HKEX’s possible offer for the entire issued and to be issued share capital of LSEG, HKEX confirms that it does not intend to make an offer for LSEG and is consequently bound by the restrictions under Rule 2.8 of the Code, save in the circumstances set out below.
The Board of HKEX continues to believe that a combination of LSEG and HKEX is strategically compelling and would create a world-leading market infrastructure group. Despite engagement with a broad set of regulators and extensive shareholder engagement, the Board of HKEX is disappointed that it has been unable to engage with the management of LSEG in realising this vision, and as a consequence has decided it is not in the best interests of HKEX shareholders to pursue this proposal.
Under Note 2 on Rule 2.8 of the Code, HKEX, and any person acting in concert with HKEX, reserves the right to announce an offer or possible offer or make or participate in an offer or possible offer for LSEG or to take any other action which would otherwise be restricted under Rule 2.8 of the Code within six months following the date of this announcement in the following circumstances: (a) with the agreement or consent of the board of LSEG; (b) if any third party announces a firm intention to make an offer for LSEG; (c) if LSEG announces a “whitewash” proposal (see Note 1 of the Notes on Dispensations from Rule 9 of the Code) or a reverse takeover (as defined in the Code); (d) if the UK Panel on Takeovers and Mergers (the “Panel”) determines that there has been a material change of circumstances; or (e) otherwise with the consent of the Panel. HKEX, and any person acting in concert with HKEX, reserves the right to acquire and/or offer to acquire LSEG shares or interests in LSEG shares subject to and in accordance with Rule 2.8 of the Code.