London Stock Exchange and Deutsche Börse merger blocked by EC

The European Commission has blocked the proposed £21bn merger of the London Stock Exchange and its German rival Deutsche Börse, ending the proposed tie-up on the day that Britain officially requests to leave the EU.

Margrethe Vestager, the EU competition regulator, said the deal between the two exchanges would create a “de facto monopoly in the crucial area of fixed income instruments”.

The EC’s opposition ends a deal that has been in the making for 13 months. LSE and Deutsche Börse had pledged to press ahead with the deal even after Britain voted to leave the EU last June. This was the third attempt at a merger between the two companies after failures in 2000 and 2005.

Vestager confirmed on Wednesday that LSE and Deustche Börse had refused to meet her requests to offset concerns about competition.

She said: “The European economy depends on well-functioning financial markets.

“That is not just important for banks and other financial institutions. The whole economy benefits when businesses can raise money on competitive financial markets.

“The merger between Deutsche Borse and the London Stock Exchange would have significantly reduced competition by creating a de facto monopoly in the crucial area of clearing of fixed income instruments.

HITC

Read more:

• USA ADP Nonfarm Employment Change: 202K vs 160K
• Iran response was ‘too fast and too furious’ on the U.S. airstrike
• USA – ISM Non-manufacturing PMI: 55.0 vs 54.5
• Top 5 things to watch on Tuesday
• Noise: How to Overcome the High, Hidden Cost of Inconsistent Decision Making