2nd UPDATE: LME Chairman: Members Need Compelling Reason To Sell-Document
17 Maggio 2012 - 3:16PM
Dow Jones News
Shareholders in the London Metal Exchange, who are also its
members, need to be shown a compelling reason to sell the
135-year-old business to any of the remaining bidders, according to
a document seen by Dow Jones Newswires Thursday.
The chairman of the LME, which is currently evaluating proposals
from three other exchanges, said the Exchange doesn't need to be
sold but that it had a duty to its shareholders to value the
company competitively once it received an approach last year.
"Throughout the process the LME has made clear its view that the
Exchange doesn't need to be sold, and that bidders will have to
show compelling reason for a transaction if they are to convince
shareholders that a sale is a good idea," Brian Bender said in a
statement in the LME's 2011 accounts.
CME Group Inc. (CME), IntercontinentalExchange Inc. (ICE) and
Hong Kong Exchanges and Clearing Ltd. (0388.HK) are the last three
bidders in the running to buy the LME, the world's biggest metals
trading exchange. NYSE Liffe, the London-based derivatives arm of
NYSE Euronext (NYX), was eliminated from the sale process Friday
following assessments by the LME's Bid Committee and board.
The process to sell the exchange, which accounts for over 80% of
the world's non-ferrous metals trade, swung into action last year
when the LME received an initial but "incomplete" approach from an
unnamed third-party, Bender said. This led the exchange to decide
that "a proper valuation of the company could only be discovered in
a competitive environment."
The LME has suspended its 2011 dividend payment while it waits
to see the outcome of the sale process, which needs to secure
approval from 75% of shareholder votes and win-over 50% of the LME
members.
The LME's chief executive meanwhile reiterated in his accounts'
statement that a sale wasn't guaranteed.
"I have often said that the LME is not for sale; but we cannot
stop people from trying to buy it and it will be interesting to see
whether bidders can show a good reason for shareholders to sell,"
Martin Abbott said. "The LME is the subject of takeover attention
because it is good at what it does, and the bid process is an
endorsement of the validity and strength of the business."
The exchange's adviser, global investment bank Moelis & Co.,
is being paid a fee of GBP3.5 million on completion of the bidding
process, plus a further fee of between 0.5% and 0.7% of the sale
price if it goes ahead, the accounts show.
The value of any potential deal remains unclear, although
analysts have said bids could be around at least GBP1 billion.
-By Andrea Hotter, Dow Jones Newswires; +44 (0)20 7842 9413;
andrea.hotter@dowjones.com
Grafico Azioni NYSE Group (NYSE:NYX)
Storico
Da Giu 2024 a Lug 2024
Grafico Azioni NYSE Group (NYSE:NYX)
Storico
Da Lug 2023 a Lug 2024
