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Nasdaq bid for London exchange falls short

By ASSOCIATED PRESS
Published February 11, 2007

LONDON - The Nasdaq Stock Market Inc. failed for the second time in a year to win control of the London Stock Exchange PLC, revealing Saturday that its $5.3-billion hostile bid had been spurned by the British bourse's shareholders.

Nasdaq, which abandoned its first attempt at the LSE several months ago, had extended its current offer by two weeks in an attempt to win over more shareholders - a move that proved fruitless.

In the end the New York exchange received acceptances worth just 0.41 percent of the LSE's ordinary shares in return for its $24.35 per share bid.

Even added to the 28.75 percent share holding Nasdaq built up by buying in the market in recent months, that remained well short of the 50 percent it needed to begin taking control.

Reflecting the increasingly acrimonious battle between the two exchanges in recent months, Nasdaq stood by its claims that the LSE was overvalued, while the London exchange's board said it looked forward to going about its business "without the distraction of ill-considered approaches which fail to understand the value of the business."

Nasdaq was just one of many suitors for the LSE in recent years - Deutsche Boerse AG and Australia's Macquarie Bank Ltd. made formal approaches while Euronext NV cited interest without naming a price - amid increasing pressure on stock exchanges to find merger partners so they can compete globally.

A combination of the Nasdaq and LSE would have created the world's second trans-Atlantic exchange with about 6,400 listed companies carrying a total market value of $11.8-trillion.

[Last modified February 11, 2007, 01:23:12]