US rival pulled out of London Stock Exchange bid because it expected Brexit vote

William Turvill
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ICE owns the New York Stock Exchange (Source: Getty)

The owner of the New York Stock Exchange pulled out of a bid for the London Stock Exchange because it was anticipating a Brexit vote, the company has revealed.

The Intercontinental Exchange (ICE) announced it would not be making a bid for the LSE, which is currently in the process of merging with German exchange Deutsche Boerse, in May.

But ICE said at the time it "reserves the right to make or participate in an offer" for the LSE "within the next six months".

Read more: After shareholder backing, merging exchanges prepare for the real challenge

Reporting its second quarter results today, ICE executives were asked about how the UK’s Brexit vote will affect the LSE-Deutsche Boerse merger.

Jeff Sprecher, chairman and chief executive, said:

When we looked at that transaction and decided that we were not going to go forward, we were very open to say that we had some concerns that we didn’t have enough information to put a credible bid on the table.

What I didn’t say at the time, that I can say now, is that at the time we did not want to talk about Brexit, and we had been urged by others not to talk about Brexit. But the way that deal was lining up it was orchestrated so that we were going to, if we entered the deal, have to put a number on the table right ahead of the Brexit vote.

Read more: London Stock Exchange shares plunge after US rival rules out bid

He explained that three UK directors on the ICE board had cautioned management that the vote would be close.

He added: “So we went out and started to talking to our UK colleagues to try to gauge where we thought the vote was going to come up. And honestly we came to the opinion that the UK was probably going to leave. And so we decided, given that we didn’t have good information and given that we thought the landscape was going to change, that it was not an appropriate time for us to do that transaction.”