Acquisition of LCH SA by Euronext could benefit firms on both sides of the trade
By Sylvia Smit, head of equity markets
delivery at Delta Capita, a business and technology
From an initial breakdown in talks with
Sweden's OM Gruppen, to further failed attempts from Macquarie
and Nasdaq throughout the mid-2000s, the story of the London
Stock Exchange’s ownership structure seemed
destined to never end. However, after 15 years of constant
rumour and rejection, the LSE’s agreement to sell
its French clearing arm to Euronext could finally pave the way
for its merger with German counterpart Deutsche Boerse.
With derivatives clearing regarded as the
main profit growth area for exchanges, this agreement certainly
represents a good deal for Euronext, which now has a much
larger clearing footprint complementary to its other services.
The LSE will be equally happy, as it calms the swathe of
anti-competition fears outlined by the European Commission. But
in terms of the wider implications, what does the LCH sell-off
mean for competition among the cluster of other European
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