HK Exchange taps banks to finance bid

City A.M. Reporter
HONG Kong Exchanges and Clearing Ltd (HKEx) is in talks with banks to help finance its bid to take over the London Metal Exchange (LME), a sign that the world’s most valuable bourse is aggressively pushing ahead with a bid.

Sources close to HKEx yesterday said it was seeking to raise up to $3bn (£1.88bn), in what would be the first-ever acquisition loan taken by the bourse.

However as the loan discussions were not public, the sources would not reveal the bank nor the amount.

Analysts value LME, the world’s largest market for industrial metals, at between £500m to £1.5bn.

LME has short-listed three other suitors – CME Group, NYSE Euronext and InterContinental Exchange (ICE) – with 7 May set as the deadline for second-round bids.

HKEx is the world’s largest bourse by market capitalisation, with a value of $18bn (£11.3bn) and sitting on cash and short-term investments of HK$30bn according to Thomson Reuters data.