[ad_1]

London Stock Exchange (LSE.L) reported higher-than-expected third-quarter income on Friday, putting it in a strong position ahead of next month’s shareholder vote on its planned deal to buy data provider Refinitiv.

A man walks past the London Stock Exchange Group offices in the City of London, Britain, December 29, 2017. REUTERS/Toby Melville/Files

The results, which include a 19% rise in income from LCH, the clearing house which dominates euro swaps clearing, show London has kept its central role in clearing euro financial transactions ahead of its divorce from the European Union.

Since the Brexit vote in 2016, Britain has leapfrogged the United States to become the largest centre for trading interest rate swaps.

The LSE reported a 12% rise in total income from continuing operations to 587 million pounds ($754.88 million) in the quarter ended Sept. 30.

Shares in LSE rose 1.2% to 7,128 pence in early trade, taking them to the top of London’s bluechip index .FTSE.

The numbers will be a boost to LSE as it pushes on with a $27 billion plan to buy data and analytics firm Refinitiv after rebuffing a $39 billion unsolicited approach from Hong Kong Exchanges and Clearing Ltd (0388.HK).

Hong Kong’s bourse scrapped its approach for the LSE earlier this month after failing to convince LSE management and investors to back its plan for a big exchange business spanning Asia and Europe.

LSE, whose shareholders will vote on buying Refinitiv in November, and that it expects the deal to go through in the second half of 2020.

“This is a transformational transaction that accelerates our group’s strategy, positioning us in key areas of future growth as a global financial markets infrastructure leader,” David Schwimmer, the former Goldman Sachs (GS.N) veteran who took over the reins at the LSE last August, said.

A merger with Refinitiv would significantly expand LSE’s information services business, which the group has been building as a more stable source of cash flow than its primary transaction-reliant businesses.

Refinitiv is 45%-owned by Thomson Reuters (TRI.TO), the parent of Reuters News.

For the third quarter, LSE’s total revenue was up 12% at 521 million pounds.

Analysts had expected total income of 565 million pounds, with total revenue of 506 million pounds according to company supplied estimates from 10 analysts.

The LSE also said finance chief David Warren would retire and step down from the board by the end of 2020. Warren will continue in his role as chief financial officer through the close of the Refinitiv deal.

LSE, which was created in 2007 when London Stock Exchange merged with Milan’s stock exchange, Borsa Italiana, said it would align its clearing and settlement businesses into one post trade division from the start of 2020.

LSE’s capital markets division, which makes money from fees paid by companies listing on its markets and trading of stocks and bonds, saw strength in fixed income trading counter subdued equity markets trading.

Reporting by Noor Zainab Hussain in Bengaluru; Editing by Rachel Armstrong and Jane Merriman

[ad_2]

Source link

قالب وردپرس