EU blocks merger of bourses

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March 30, 2017

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EU blocks merger of bourses

Source: AP | 00:01 UTC+8 March 30, 2017 |

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EUROPEAN regulators blocked the proposed merger of Germany’s Deutsche Boerse and the London Stock Exchange yesterday, saying it would effectively have created a European monopoly in clearing bonds.

They shot down the pair’s third attempt at a merger, which would have united the stock exchanges of Germany, Britain and Italy as well as the biggest European clearing houses.

European Union antitrust chief Margrethe Vestager said the deal “would have significantly reduced competition by creating a de facto monopoly in the crucial area of fixed-income instruments” such as bonds.

The decision was expected after the London exchange said last month that it couldn’t commit to selling its majority stake in the electronic bond market MTS, which would have alleviated the EU’s concerns.

The deal would have joined Deutsche Boerse’s Frankfurt-based clearing house, Eurex, with LSE’s LCH.Clearnet and Rome-based Cassa di Compensazione e Garanzia. “They are basically the only companies that provide fixed-income clearing services in Europe,” Vestager said.

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EU blocks merger of bourses

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