London Stock Exchange edges closer to data market with Refinitiv deal

Key approval from US Committee on Foreign Investment comes through for $27bn takeover deal

The London Stock Exchange Group (LSEG) announced on Monday, March 16 that it had gained approval from the US Committee on Foreign Investment for its $27bn (£21bn, €24bn) takeover of analytics firm Refinitiv, judging that there were no national security concerns surrounding the deal.

Refinitiv is a financial markets data collector jointly owned by Blackstone Group, which has a 55 per cent stake, and Thomson Reuters which owns 45 per cent. Antitrust clearances such as this from the US Committee on Foreign Investment are key milestones in the deal for LSEG to take over the firm.

A Refinitiv statement given at the announcement of the takeover late in 2019 said: “The transaction will create a leading, UK-headquartered, global financial market infrastructure (FMI) provider with a leading data and analytics business, significant capital market capabilities across multiple asset classes and a broad post-trade offering, well positioned for future growth.”

Once the deal is complete, Refinitiv’s shareholders – a consortium of investment funds affiliated with Blackstone as well as Thomson Reuters – will hold around 37 per cent economic interest in the London Stock Exchange Group and less than 30 per cent of the total voting rights of the group.

The Financial Times reports that the deal tops off a move away from a reliance on transactions for LSEG and a move into financial data. Commentators add that the deal will give LSEG the size and scale to compete with large US exchange operators, as well as Bloomberg.

Refinitiv’s Chief Executive Officer David Craig will continue in his role and join LSEG’s executive committee. The combined business will be chaired by LSEG’s chairman Don Robert and led by David Schwimmer, LSEG’s chief executive officer with David Warren as LSEG’s chief financial officer.

LSEG said it remained committed to closing the deal during the second half of 2020. The deal has a “long-stop date” of May 31 2021, meaning it will not go through if not completed by this date.

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