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Brussels likely to block Deutsche Boerse merger, admits London Stock Exchange

The expected £21bn London Stock Exchange (LSE) and Deutsche Boerse looks to have hit the rocks after the LSE announced that the Brussels regulator looks unlikely to rubber stamp the deal.

In an announcement on Sunday night, the LSE said that the European Commission had unexpectedly raised concerns about the market’s majority stake in Italian bold holding platform MTS SpA on 16 February.

It said that the EU had given it until midday today to submit a new proposal which was to include plans to divest from the Italian business, something which the LSE said it was not going to do as it was not in the interest of shareholders.

The deal now looks like it will be called off, with LSE stating: “Taking all relevant factors into account, and acting in the best interests of shareholders, the LSEG Board today concluded that it could not commit to the divestment of MTS.

“LSEG will therefore not be submitting a remedy proposal with respect to MTS. Based on the Commission’s current position, LSEG believes that the Commission is unlikely to provide clearance for the Merger.”

The LSE had agreed to sell off its French clearing business, LCH SA, to Euronext in the event of any merger going through; however, that too now looks set to be nixed.

Striking a defiant tone, the LSE concluded that the collapse of the merger would not unduly effect its business and that it remained confident in its operations and senior team.

The statement said: “The LSEG Board is highly confident in the strength of LSEG’s business, strategy and prospects on a stand alone basis, under its strong management team led by Chief Executive Xavier Rolet.”

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