Deutsche Boerse says might lower acceptances threshold for LSE merger

By: | Published: July 11, 2016 10:56 AM

Deutsche Boerse AG is considering lowering the approval threshold for its proposed merger with London Stock Exchange Group Plc from shareholders representing 75 percent of its shares, the German exchange said on Sunday.

The exchange said in a statement the parties involved were looking at the potential for lowering the minimum acceptance threshold "with a view to enabling index funds to participate in the offer". (Reuters)The exchange said in a statement the parties involved were looking at the potential for lowering the minimum acceptance threshold “with a view to enabling index funds to participate in the offer”. (Reuters)

Deutsche Boerse AG is considering lowering the approval threshold for its proposed merger with London Stock Exchange Group Plc from shareholders representing 75 percent of its shares, the German exchange said on Sunday.

The merger, if approved by the shareholders and cleared by regulators, will create the world’s biggest exchange by revenue, forecast to be 4.7 billion euros ($5.19 billion) this year from stock, bond and derivatives trading, indexes, market data, and clearing and settlement.

But Deutsche Boerse said it was concerned that the 75 percent threshold for its shareholders to approve the deal might prove difficult to cross because index funds which hold up to 15 percent of its shares are unable to accept the offer until the minimum level of acceptances has already been reached.

The exchange said in a statement the parties involved were looking at the potential for lowering the minimum acceptance threshold “with a view to enabling index funds to participate in the offer”.

A final decision on whether to lower the minimum threshold will be made on Monday, it said.

London Stock Exchange Group said on July 7 that the U.S. and Russian authorities had approved the $27 billion merger. EU regulators have yet to approve the deal.

On July 4 LSE shareholders voted to approve the deal, hoping it can go through despite Britain’s vote to leave the European Union.

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