Nasdaq unveils hostile LSE offer

The Nasdaq has unviled a hostile bid for the London Stock Exchange (LSE) worth £2.7bn ($5.3bn), after having two previous takeover approaches rejected.

In November the LSE rejected the £2.7bn US bid, saying it undervalued the firm.

LSE also turned down a request for a meeting from Nasdaq, which has raised its stake in LSE to 28.75%.

The Nasdaq is now posting out its offer document to LSE shareholders, setting a price of £12.43 a share, and says it has borrowed $5.1bn to fund a takeover.

January deadline

Part of that new loan, the exchance said in a statement, would be used to repay all of its most significant current debt, while the firm said it would also issue new stock worth $775m.

The final date for shareholder acceptance of the Nasdaq offer by LSE shareholders is 11 January 2007.

Shares in the London stock market company have more than doubled over the past year amid ongoing speculation it would be subject to a takeover offer.

In March, Nasdaq dropped a proposed £2.43bn ($4.2bn) bid for the exchange after the LSE rejected its advance.

The US firm is the latest in a long line of foreign suitors to approach the London market.

German market Deutsche Boerse, Australian investment bank Macquarie and the pan-European exchange Euronext have all abandoned offers for LSE since December 2004.

The LSE has resisted approaches saying it can continue to grow alone, while the UK government has said it is neutral as to the nationality of LSE's owner.

But analysts and market observers have said that the Nasdaq is in a strong position and stock exchanges will need to merge if they want to keep on growing and offer a wide-range of global financial services.

http://news.bbc.co.uk/2/hi/business/6171223.stm