London Stock Exchange

Hong Kong's stock exchange pulls takeover offer for London Stock Exchange

Hong Kong stock excahnge
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Hong Kong Exchanges and Clearing pulled a $39 billion takeover offer for the London Stock Exchange, following opposition from LSE's board and an inability to secure large shareholder support.

Why it matters: LSE opposition was officially driven by strategic and pricing concerns, but cannot be divorced from concerns over the future viability of Hong Kong's "one country, two systems" relationship with China.

London Stock Exchange rejects takeover bid from Hong Kong's stock exchange

The main entrance of the London Stock Exchange. Photo: Chris J Ratcliffe/Getty Images

The London Stock Exchange this morning rejected a proposed $39 billion takeover by Hong Kong Exchanges and Clearing, saying that it instead plans to proceed with its own $27 billion acquisition of financial data firm Refnitiv.

Why it matters: We suggested this one could face political headwinds, and it appears that LSE's board felt the same, per the mention in its rejection letter of how HKEX's government relationships could "complicate matters." LSE also told HKEX not to bother with a follow-up offer, writing: "The board unanimously rejects the conditional proposal and, given its fundamental flaws, sees no merit in further engagement."

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