The American stock market operator Nasdaq is in the early stages of plotting a potential takeover bid for the London Stock Exchange.
Bob Greifeld, the Nasdaq chief executive, is said to have asked his senior executives to dust off their files on the LSE, which he attempted to buy in 2006.
It is understood that any potential approach is still some way off and that Nasdaq has yet to appoint advisers to work on an offer. However, preliminary work on a possible bid began last week after the collapse of the LSE’s attempted merger with Canadian rival TMX Group.
The setback instantly fuelled speculation that the LSE, led by chief executive Xavier Rolet, would fall victim to a new takeover approach.
“Bob’s trying to work out whether he should pick up the phone to Xavier or wait for Xavier to pick up the phone to him,” said one exchange industry source.
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Shares in the LSE spiked last week in anticipation of an offer from Nasdaq or the Singapore stock exchange, closing on Friday at £10.33.
Nasdaq’s failed bid five years ago was priced at £12.43 a share. It is thought a new approach could value the LSE at £12.75 a share. The LSE’s biggest shareholders, Borse Dubai and the Qatar Investment Authority, bought their holdings at between £15 and £16 a share.
Greifeld is said to be keen to wait until the future of the sector becomes clearer before making any move. It is in a period of overwhelming global change following regulatory shifts that have opened the industry to competition. The exchange operators have responded to the new competitors with a wave of consolidation.
NYSE Euronext, which operates the New York Stock Exchange and exchanges across Europe, is expected to get shareholder approval for a merger with the German exchange giant, Deutsche Börse, this week.
That could prompt a European competition investigation into market share in derivatives trading, potentially forcing the new group to sell its Liffe derivatives exchange in London.
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The enlarged group may also be forced to divest parts of its trade clearing and settlement operations. Any such ruling would add a new dimension to the debate.