Hong Kong Exchanges and Clearing has launched a £ 31.6bn shock bid for the London Stock Exchange Group in a move to disrupt the British rival's association with Refinitive.
Stocks in the London Stock Exchange (LSE) surged as much as 16% higher after the Hong Kong Stock Exchange revealed the cash-and-stock approach.
Hong Kong Exchanges and Clearing (HKEX) proposes to pay around £ 8.36 per share – which values the LSE at around £ 29.6 billion, or £ 31.6 billion including debt.
But HKEX said the potential offer depends on LSE's planned $ 27 billion (£ 21.9 billion) to buy the scrap data provider Refinitive.
month, which would see major Refinitive shareholders, including Blackstone and Thomson Reuters, take a 37% stake in the expanded company.
HKEX said that the merger with LSE would "redefine global capital markets for decades to come."
It said it has had "early engagement" with LSE and plans to seek a recommendation from the board.
However, LSE labeled HKEX's proposal “unsolicited, preliminary and highly conditional. "
It added that it would consider the procedure, although it emphasized it" Remains committed to and continues to make good progress with its proposed acquisition of Refinitive. "
HKEX's proposed offer price marks 23% premium on LSE's closing price on Tuesday.
It believes the agreement with LSE will strengthen both businesses, give them better geographical reach and offer market participants and investors "unique global market connectivity".
HKEX Chief Charles Li said: "Bringing HKEX and LSEG together will redefine global capital markets for decades to come.
" Both companies have good brands, financial strength and proven growth results.
"Together we will connect east and west, become more diversified and we will b be able to offer customers greater innovation, risk management and trading opportunities."
The approach for LSE comes after a £ 21