TowerGroup have put out a recent View Point on what next for the LSE and Nasdaq following the lapsed bid on 10 February.
Under the UK’s takeover rules, Nasdaq’s bid for LSE lapsed on February 10, 2007. The two exchanges now have to work out how to move on. The new report from TowerGroup recommends the LSE goes down the route of interoperability, another way to move in the direction of consolidation.
TowerGroup says it identifies the lapsed bid as evidence that LSE shareholders and stakeholders recognise the LSE as the only major international securities exchange operating under a principles-based, financial regulatory structure.
The failed bid leaves Nasdaq with the challenge of if and how to extract value from its significant minority investment of 29.16 per cent.
Conversely, the lapsed bid provides the LSE with an opportunity to determine if and how it can work with Nasdaq to the mutual benefit of the two exchanges, according to TowerGroup.
Tower Group says LSE interoperability offers it the distinct business and technical benefits as a mechanism for the consolidation of exchanges without losing the independence a takeover removes.