Sunday 17 April 2016 7:38 pm

Brexit vote could not see merged London Stock Exchange group's headquarters moved from UK to Germany, sources close to deal confirm

Sources close to the London Stock Exchange-Deutsche Boerse deal have dismissed the prospect of the merged company having its headquarters outside of the UK in the event of a Brexit.

Under the terms of the proposed £21bn merger, set out last month, the headquarters of the holding company, UK TopCo, would be based in London.

An interview in the German media with Deutsche Boerse chief executive Carsten Kengeter today suggested this could be subject to change in the event of a UK vote to leave the EU.

Read more: Capitalism, not politicians, must decide stock exchange merge

But sources close to the deal have dismissed the suggestion the location of the holding company could be changed.

A source told City A.M.: "The location of UK TopCo in London was a non-negotiable element of the merger and would not be revisited in the event of a Brexit vote."

They added: "Carsten Kengeter's remarks in the interview reflected nothing more than the standard reply to questions concerning the scope the referendum committee's role."

Read more: Brexit warning from Germany over London Stock Exchange merg

Kengeter, who would be chief executive of the merged company, told Tagesspiegel that, if the UK votes for a Brexit, a Referendum Committee could consider the location of the holding company. 

He emphasised in the interview that Deutsche Boerse's corporate office will remain in Frankfurt and the LSE's in London.

This came after a member of parliament in Germany, Ulrich Caspar, told City A.M. last week that the merged company could "under no circumstances" be based in the London rather than Frankfurt if the UK votes for a Brexit.

Read more: London Stock Exchange chief: Brexit impact would be "substantial

The fact a Referendum Committee would be formed in the event of a Brexit was announced along with the terms of the deal in March.

Its recommendations, City A.M. understands, are non-binding.

Deutsche Boerse's finance chief Gregor Pottmeyer also told the German media over the weekend that a Brexit was not a "risk". But he suggested it would have an impact on a potential counter-bid from the United States.

The Intercontinental Exchange (ICE), which owns the New York Stock Exchange, is thought to be readying a bid for the London Stock Exchange.

Pottmeyer told Euro am Sonntag: "It could be a risk for US exchanges, which could present a counter offer for the LSE."