London Stock Exchange Group

History

The London Stock Exchange was founded in Sweeting's Alley in London in 1801 and moved to Capel Court the following year. In 1972, the Exchange moved to a new purpose-built building and trading floor in Threadneedle Street. Deregulation, sometimes known as "big bang", came in 1986 and external ownership of member firms was allowed for the first time. In 1995, the Alternative Investment Market was launched.

In 2001, the exchange became a public limited company, London Stock Exchange plc, floating with a market capitalisation of £1.1bn. The Exchange moved again, in 2004, this time to Paternoster Square. The company rejected a takeover bid from Deutsche Börse worth £1.3 billion in December 2004, and from Macquarie worth £1.5 billion in December 2005.

Between April and May 2006, having been rebuffed in an informal approach, Nasdaq built up a 23% stake in the Exchange. The stake grew to 29% as a result of the London exchange's share consolidation. Nasdaq has since sold its investment.

In 2007, the Exchange acquired the Milan-based Borsa Italiana for €1.6bn (£1.1bn; US$2bn) to form the London Stock Exchange Group plc (LSEG). The combination was intended to diversify the LSE's product offering and customer base. The all-share deal diluted the stakes of existing LSE shareholders, with Borsa Italiana shareholders receiving new shares representing 28 per cent of the enlarged register. On 16 September 2009, LSEG agreed to acquire Millennium Information Technologies, Ltd., a Sri Lankan-based software company specialising in trading systems, for US$30m (£18m). The acquisition was completed on 19 October 2009.

On 9 February 2011, TMX Group, operator of the Toronto Stock Exchange agreed to join forces with LSEG in a deal described by TMX head Tom Kloet as a 'merger of equals' (though 8/15 board members of the combined entity will be appointed by LSE, 7/15 by TMX). The deal, subject to government approval would create the world's largest exchange operator for mining stocks. In the UK, the LSE Group first announced it as a takeover, however in Canada the deal was reported as a merger. The provisional name for the combined group would be LTMX Group plc. On 13 June 2011, a rival, and hostile bid from the Maple Group of Canadian interests, was unveiled for the TMX Group. This was a cash and stock bid of CA$3.7 billion, launched in the hope of blocking the LSE Group's takeover of TMX. The group was composed of the leading banks and financial institutions of Canada. The London Stock Exchange however announced it was terminating the merger with TMX on 29 June 2011 citing that "LSEG and TMX Group believe that the merger is highly unlikely to achieve the required two-thirds majority approval at the TMX Group shareholder meeting".