Furse and Seifert to meet over £1.35bn bid for LSE

Tomorrow Clara Furse, the chief executive of the London Stock Exchange (LSE), is due to meet her opposite number, Werner Seifert of Frankfurt's Deutsche Börse, in an effort to hammer out an agreed £1.35bn cash bid by the Börse.

Tomorrow Clara Furse, the chief executive of the London Stock Exchange (LSE), is due to meet her opposite number, Werner Seifert of Frankfurt's Deutsche Börse, in an effort to hammer out an agreed £1.35bn cash bid by the Börse.

Events will be watched closely by the management of Euronext, the Paris-based exchange operator. Although its representative declined to comment, the organisation is understood to be reviewing the situation. Analysts would be surprised to see Euronext intervene with a bid of its own before seeing the terms of any deal between London and Frankfurt, and particularly any concessions made by either side.

London is keen to see a senior role reserved for Ms Furse, while the Börse wants to play down differences in the two sides' business models.

Frankfurt operates what has been called a "vertical silo", in which it controls the trading platform, clearing transactions and settlement of the eventual contracts. "The same thing happens in London," a source close to the Börse said, "but the only difference is that the LSE does not own all three functions. The important point is that they should be transparent."

Sources on both sides shed doubt on reports that the Börse would make a formal bid this week.

While the UK authorities are understood to be relaxed at the prospect of the ownership of the main UK stock market moving overseas, eyebrows have been raised at Mr Seifert's colourful lifestyle.

A spokesman for the German camp was last night playing down the significance of Mr Seifert using an office at the London headquarters of Euromoney International Investor, a publishing company which employs Lisa Traeger, his former girlfriend. Critics have claimed that he left confidential documents at the Euromoney offices, but the spokesman said it was "ridiculous" to link that to the unexplained movement in the LSE share price last Friday week, ahead of the news that the Börse was planning a bid.

The Financial Services Authority, which has acquired the LSE's former role as listing authority for UK quoted shares, is understood to be examining the circumstances under which the share price rose. An LSE source suggested that the movement came in response to hedge fund tactics.