LSE Set to Finally Win EU Antitrust Approval for its $27bn Acquisition of Refinitiv

Deal Update: The London Stock Exchange Group is reportedly set to win EU antitrust approval for its $27bn acquisition of Refinitiv, bolstering its footprint in a rapidly consolidating sector.

This update arrives just 2 months after it was reported that LSE was set to receive EU antitrust objections. However, since then, LSEG has tweaked concessions to address the competition concerns. Last month, LSE offered to allow competitors unrestricted access to its clearing and data operations for the next 10 years. The offer is part of a large package of concessions, which also included LSEG’s recent sale of Borsa Italiana to pan-European exchange Euronext.

Context: LSEG initially unveiled its plan to acquire Refinitiv last year (August 2019) but faced significant hurdles in Brussels, as a result of concerns from the EU competition watchdog. The European Commission is now set to conclusively decide on the deal by January 2021 and LSE no longer needs to make any further major concessions. LSE shares soared 9.6% amid reports that the deal will be cleared.

The combined LSE and Refinitiv would still be eclipsed by financial data leader Bloomberg but will outrank the $44bn merger between S&P Global and IHS Markit, which was announced earlier this week and is the largest acquisition of 2020.

Similar to the LSE-Refinitiv deal, numerous other leading exchanges are also seeking to diversify into data and other services. In August, LSE rival Intercontinental Exchange (ICE) acquired Ellie Mae for $11bn and in November, Deutsche Boerse announced it would purchase 80% of Institutional Shareholder Services for $1.8bn. Deutsche Boerse also offered to buy Borsa Italiana, Italy’s only stock exchange, but lost to Euronext.