Stock Exchange enters £1bn battle for LME

The London Stock Exchange has emerged as one of nine potential bidders in the £1bn auction of the London Metal Exchange.

The exchange, currently in exclusive talks with LCH.Clearnet – which provides much of London's share-trading back office – over a potential merger, could team up with the Singapore Stock Exchange to generate added firepower for what is expected to be a hotly contested battle. The LME, a private company whose shares are held by its member firms, including banks and metals dealing houses, put itself up for sale last week amid a flurry of contacts with potential bidders. They have been attracted by its status as one of the few remaining independent exchanges available that is not part of one of the major exchange blocs. Business at the LME, which famously still operates part of its business on a type of "open outcry" trading that held sway across the City before screen-based dealing took over, has been booming amid record high commodity prices and volumes.

Talks were said to be at "a very early stage". However, the LSE was thwarted in its attempt to pull off a merger with the Toronto Stock Exchange earlier this year and is very much on the hunt for further deals. Nationalistic concerns played a role in the failure of the Toronto deal, with a large enough minority of the exchange's shareholders voting against to block the plans. That sparked speculation that the Nasdaq, which subsequently took over Nordic exchange group OMX, could make a third tilt at the LSE.

However, its chief executive Bob Greifeld upset a number of people in London with the high-handed manner in which he conducted the bid. And even though the London exchange's management has changed, there is little appetite to tie up with the US group. Xavier Rolet, LSE chief executive, has made clear his ambition to diversify the exchange's business away from its core equity trading arm. He has already added MillenniumIT, a Sri Lankan technology business, to the exchange's portfolio and has been winning contracts and improving links with other exchanges as a result.

But a takeover of the LME, with or without a partner, would be of an entirely different magnitude, establishing Mr Rolet's deal-making credentials and transforming the LSE once again into a premier league player in the exchange landscape.

Like the LSE, the Singapore exchange is also coming off a failed merger, when its attempt to seal a deal with Australia's ASX exchange was blocked by the Australian Government.

While most major exchange groups are likely to be casting eyes at the LME, the operation could easily fall prey to an American operator, which have previously proved willing to pay up to get a deal done. Michael Spencer's Icap, a money broker which now has many of the characteristics of an exchange, has also indicated he would be interested but has proved reluctant to overpay in the past.

Another contender could be the Chicago Merchantile Exchange, the US derivatives group, that has previously approached the LME.

peopleFrankie Boyle responds to referendum result in characteristically offensive style
Life and Style
Couples have been having sex less in 2014, according to a new survey
New Articles
i100... with this review
Holly's review of Peterborough's Pizza Express quickly went viral on social media
footballTim Sherwood: This might be th match to wake up Manchester City
Arts and Entertainment
musicHow female vocalists are now writing their own hits
New Articles
ebooksAn unforgettable anthology of contemporary reportage
Arts and Entertainment
musicBiographer Hunter Davies has collected nearly a hundred original manuscripts
Blahnik says: 'I think I understand the English more than they do themselves'
Arts and Entertainment
Michelle Dockery as Lady Mary Crawley in Downton Abbey
TVInside Downton Abbey series 5
Life and Style
The term 'normcore' was given the oxygen of publicity by New York magazine during the autumn/winter shows in Paris in February
fashionWhen is a trend a non-trend? When it's Normcore, since you ask
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Senior BA - Motor and Home Insurance

£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

Market Risk & Control Manager

Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...

SQL Developer - Watford/NW London - £320 - £330 p/d - 6 months

£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Head of Audit

To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...

Day In a Page

Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

Despite the result, this is the end of the status quo

Boyd Tonkin on the fall-out from the Scottish referendum
Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

Manolo Blahnik: Flats, Englishness, and Mary Beard

The shoe designer who has been dubbed 'the patron saint of the stiletto'
The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

Scrambled eggs and LSD

Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

'Normcore': Blending in is the new standing out

Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

New leading ladies of dance fight back

How female vocalists are now writing their own hits
Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam