LSE meets Nasdaq over Italian takeover

The London Stock Exchange today confirmed it has met with failed suitor and US rival Nasdaq as it seeks shareholder backing for its £1.1bn (€1.6bn) Borsa Italiana takeover.

LSE chief executive Clara Furse met earlier this week with Nasdaq, which has held on to its 30% stake in the LSE following an unsuccessful £2.7bn (€4bn) hostile bid for the group at the beginning of the year.

It is believed the meeting – thought to be the first between the two since the LSE fended off Nasdaq’s advances – was arranged in a bid to head off any moves by Nasdaq to block the Borsa Italiana deal.

The LSE must gain support from at least 50% of shareholders to succeed in its takeover of the Milan-based exchange, announced late last month.

If the Borsa Italiana purchase goes through, it would dilute Nasdaq’s share of the enlarged business and make it harder for the technology exchange to make another takeover attempt.

News of the meeting came as the LSE gave an update on first quarter trading.

The group revealed that revenues for the three months to June 30 rocketed by 19% to £100.1m (€148m) against the same period last year.

The LSE added that average daily trading volumes on its electronic SETS system more than doubled to 501,000.

Merrill Lynch said today’s update was “positive but not transformational”, with revenues 8% ahead of their estimates.