LSE widens campaign against Nasdaq bid
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The London Stock Exchange PLC issued a strong profit forecast and promised a higher dividend Tuesday as it urged shareholders to reject a hostile takeover bid by the Nasdaq Stock Market Inc.
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(InfoWorld) - The Nasdaq Stock Market's efforts to buy the London Stock Exchange PLC is another milestone in globalization, and touches the world of IT. As exchanges merge and increase the fluidity of funds globally, a new world of competitive options open. The Nasdaq's latest bid, launched Nov. 20, to buy the part of the LSE it doesn't already own for Â£2.7 billion ($5.1 billion) is poignant in its historic and political overtones. The Nasdaq tapped technology to match buyers and sellers -- starting with simple bulletin boards -- and helped revolutionize trading over the last 20 years. As world class IT companies like Microsoft and Oracle went public on the Nasdaq, the exchange rode the computerization of modern life to great success. Most exchanges have adopted some form of electronic trading, including Nasdaq archrival the New York Stock Exchange (NYSE Group Inc.) and the LSE itself. Exchanges have unique advantages and retain distinct personalities, however. Linux vendor Red Hat Inc., for example, will move from the Nasdaq to the NYSE Tuesday. "The New York Stock Exchange has much stronger global recognition, and we're looking for a global branding image," said Linda Brewton, Red Hat manager of investor relations. She also noted that even though the NYSE has adopted electronic trading, trading is still done under live market specialists and that this reduces share-price volatility. The LSE, which traces its history back some 300 years, has rejected Nasdaq's bid, claiming it undervalues the exchange. The mercurial mayor of London, Ken Livingstone, is also on the case. Last week he asked the U.K.'s Office of Fair Trading to investigate, claiming that the acquisition would eliminate competition to U.S. markets for international company listings. Livingstone also echoed the concerns of many Europeans, that as U.S. exchanges merge with European markets, tighter U.S. regulations would hamper Europe's growing market competitiveness. This last issue has also caused bumps in the NYSE's deal to merge with the Euronext NV exchange. Nasdaq, having already bought about 29 percent of the LSE earlier this year, is appealing to shareholders. Nasdaq Chief Executive Officer Robert Greifield apparently believes the exchange needs the merger to compete. The merging of exchanges and the broader, growing numbers of mergers and acquisitions that IT companies are involved in are part of the same phenomenon, according to according to Eric Gebaide, managing director of Innovation Advisors, a New York investment firm. "It's a manifestation of the globalization of financial markets," Gebaide said. "That in turn is a precursor of the globalization of technology." When companies in Europe and Asia enjoy the same sort of availability of capital U.S. companies have, it can lead to greater competition for U.S. companies. However, U.S. companies can also take advantage of the new era of capital. For example, U.S. companies looking to efficiently use capital now have access to alternative local financing for offshore ventures, Gebaide notes. In the new global market, companies can even go public with offshore ventures, he suggests. The Nasdaq bid will probably play out into 2007. The offer to shareholders can be extended to 60 days, and the Nasdaq can still buy LSE shares on the open market. But no matter how it ends, the internationalization of capital markets will continue to have a profound impact.
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Nasdaq  launched its 2.7 billion pound ($5.3 billion) hostile bid for the London Stock Exchange  on Tuesday, appealing directly to investors after being spurned by Europe's biggest stock market.
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LONDON -- Nasdaq launched a $5.3 billion hostile bid for the London Stock Exchange yesterday. It needs just a fifth of the London exchange's shareholders to say yes before it can take control.
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LONDON/NEW YORK  - Nasdaq  launched its 2.7 billion pound ($5.3 billion) hostile bid for the London Stock Exchange  on Tuesday, needing just over a fifth of LSE shareholders to accept for it to take control.
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NYSE Euronext  and Australia&#39;s  ASX Ltd  may be interested in buying some or part of  Nasdaq Stock Market Inc&#39;s  stake in London Stock  Exchange Plc , a person familiar with the matter said on  Monday.
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The London Stock Exchange issued a bullish profit forecast and pledged a dividend hike on Tuesday as it urged shareholders to reject a 2.7-billion-pound ($5.27-billion) hostile bid from U.S. rival Nasdaq.
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Deutsche Boerse turned up the heat in the long-running battle for the London Stock Exchange, saying it would talk directly with the LSE's shareholders and users after the London market's management rejected Frankfurt's 1.3-billion-pound takeover bid as insufficient.
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The US stock exchange operator Nasdaq failed to win control of the London Stock Exchange after LSE shareholders decided overwhelmingly against backing a hostile takeover worth 2.9 billion pounds (4.4 billion euros, 5.5 billion dollars).
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The Nasdaq Stock Market Inc. formally launched its hostile $5.3 billion takeover bid on Tuesday for the London Stock Exchange Group PLC, which promptly reiterated that the offer is too low and urged its shareholders to take no action on it.
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The European financial market operator Euronext appears to be edging ahead in the battle with Deutsche Boerse of Germany to acquire the London Stock Exchange (LSE) because of a more appealing offer on fees, financial sources said.
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Defensive stocks were in demand on Monday as the FTSE 100 sustained further losses.
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The deadline in the Nasdaq's approach to LSE shareholders to accept its proposed takeover bid approaches.
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The London Stock Exchange  reiterated on Tuesday its rejection of a 2.7 billion pound ($5.3 billion) bid from U.S. rival Nasdaq Stock Market Inc .
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The Nasdaq Stock Market said the move will help meet competition from rivals who are also expanding overseas.
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The global sell-off on equities markets continued in London on Friday, as investors pulled more money out of financial stocks amid fresh worry about losses relating to the US subprime lending crisis.
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As Nasdaq's battle for the London Stock Exchange  reaches a climax on Saturday with the deadline for shareholders to accept, the LSE's share price suggests the U.S. bourse may fail, analysts said.