THE London Stock Exchange is mulling a bid for a majority stake in European clearing house LCH.Clearnet, just three months after ruling itself out of the race to own the prized trading asset.
The LSE’s move to take control of the last independent clearing house in Europe follows the collapse of its merger with Canada’s TMX Group and comes ahead of the looming merger between Germany’s Deutsche Boerse and NYSE Euronext.
A takeover of LCH would give the LSE control of a vital part of the trading process and strengthen it against the newly-merged rival European exchange, which would have a huge market-leading presence in both derivatives trading and clearing.
The LSE currently has no clearing facility of its own and clears its UK equity trades through LCH, which is also London-based.
But LCH, privately owned by 98 banking and broking groups, is already considering proposals from other exchange and post-trade services operators including Markit, with the backing of the NYSE Euronext.
US exchange Nasdaq OMX also said in June it had bid for a minority stake in the clearing house, which is considered a sought-after asset. The offers tabled are thought to value LCH at up to €1bn (£885m).
The London Stock Exchange and LCH.Clearnet both refused to comment last night.