LSE beats Markit to LCH.Clearnet takeover

The London Stock Exchange has emerged the successful bidder for sought-after clearing house LCH.Clearnet, its rival in the race, Markit, has said.

Markit, which had offered to buy LCH entirely from its bank and stock exchange owners, said it had not gained enough support from the LCH board at a crunch meeting yesterday.

The news leaves the LSE in pole position to win the prized post-trade services asset, and will bolster chief executive Xavier Rolet after he missed out on the acquisition of Canadian exchange TMX Group. The LSE is reportedly seeking a 51 per cent stake in LCH.

The LSE currently clears its trades through LCH and stands to reap substantial benefits from controlling the business in-house.

“We unfortunately did not receive the LCH.Clearnet board support required to move ahead and seek shareholder support,” Markit said in a statement.

“We believe the markets would have benefited significantly from Markit’s ownership of LCH.Clearnet since we would have preserved and reinforced a neutral, horizontal clearing model.”