London Metal Exchange considers selling itself in a potential $1.5 billion deal
24 Sep 2011
The London Metal Exchange (LME), the world's top market for industrial metals yesterday said that it has received multiple takeover approaches and is considering selling itself, a deal that analysts say could value the 130 year-old Exchange at around $1.5 billion (£1 billion)
''The London Metal Exchange has received several expressions of interest with regard to potential strategic transactions,'' the bourse said in a statement. The exchange ''will begin a formal process which may or may not lead to an acceptable offer for the company being received.''
Although The LME did not name suitors, several media reports speculated that US-based IntercontinentalExchange, CME Group Inc, the Singapore Exchange and the London Stock Exchange as potential bidders.
Chicago-based CME Group, the world's largest futures market, had in 2008, acquired the New York Mercantile Exchange for $7.6 billion (See: World's largest exchange is born as Chicago Board of Trade - Chicago Mercantile Exchange merge), while IntercontinentalExchange acquired the New York Board of Trade for $1.06 billion in 2006.
Any bidder would need the consent for sale from at least 75 per cent of The LME's 92 members, who include miners like BHP Billiton, Chilean copper giant Codelco, banks such as Goldman Sachs, JPMorgan Chase & Co, and Barclays among others.
The LME is the world's biggest metal exchange, on which a little over 120 million transactions worth $11.6 trillion were traded last year at a daily average of $46 billion with more than 95 per cent of its business coming from overseas.
