LSE gets EU green signal for Refinitiv acquisition
The acquisition had run into choppy waters after the Commission opened up an in-depth investigation of the proposed transaction between LSEG, a global financial markets infrastructure business, and data services provider Refinitiv. The approval, however, comes with certain conditions.
The in-depth investigation found several concerns, which would have harmed competition in several markets. This includes concerns in electronic trading of European Government Bonds (EGBs), trading of dealer-to-customer over-the-counter interest-rate derivatives (OTC IRDs), consolidated real-time datafeeds (CRTDs) and desktop services and index licensing.
Infrastructure competition in trading services and access to financial data products on fair and equal terms is essential for the European economy and in particular for consumers and businesses, said Margrethe Vestager, executive vice-president in charge of the competition policy. “Today, we can approve the proposed acquisition of Refinitiv by LSEG because LSEG offered commitments that will ensure that the markets will remain open and competitive and the acquisition will not lead to higher prices or less choice and innovation for these products,” added Vestager.
The Commission has proposed remedies, including to divest LSEG’s 99.9% stake in the Borsa Italiana group, including MTS (its trading venue for EGBs), which has been signed over to Euronext. The stock exchange group has been asked to continue offering its global OTC IRD clearing services provided by LCH Swapclear on an open access basis and not engage in commercial strategies that would discriminate customers based on the source of their OTC IRD trade submitted to LSEG for clearing. The Commission has further mandated LSEG to provide access to the LSE venue data, FTSE UK Equity Indices and the WM/R FX Benchmarks to all existing and future downstream competitors.