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LSE surges on $27bn Refinitiv takeover talks

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London (AFP)

London Stock Exchange shares soared Monday after confirming talks over a vast $27-billion takeover of US financial data provider Refinitiv, potentially placing it in direct competition with Bloomberg.

The mooted takeover, which is worth the equivalent of 24 billion euros and marks a major switch in strategy under LSE CEO banker David Schwimmer, sent shares spiking to a record peak.

"London Stock Exchange Group plc ... confirms that it is in discussions with a consortium including certain investment funds affiliated with Blackstone as well as Thomson Reuters about a possible acquisition of Refinitiv Holdings Ltd," it said in a statement.

The deal, which remains subject to regulatory approvals, would be financed by the issuing of new shares.

The LSE had already announced the news on Saturday in response to a Financial Times newspaper report.

Refinitiv, which serves in excess of 40,000 institutions in more than 190 countries, was formerly the financial and risk business of Thomson Reuters.

The data provider is now joint-owned by Canadian media group Thomson Reuters and private equity firm Blackstone -- which is the majority shareholder.

In late morning Monday trade, LSE shares stood at 6,502 pence, up 14.63 percent on the FTSE 100 index, which in turn rose 1.2 percent in value.

"The London Stock Exchange share price has risen to a record high after announcing it is in talks to buy data analytics company Refinitiv for the sum of $27 billion," noted CMC Markets UK analyst Michael Hewson.

"This merger -- if it gets the green light from regulators in the US and Europe -- would make the combined business a market leader in data and information, putting it on a par with Bloomberg."

If the deal goes ahead, Refinitiv's current shareholders would keep about 37 percent of the enlarged group.

The Refinitiv news marks a change of LSE strategy and comes two years after its failed £21-billion merger with Germany's Deutsche Boerse.

That gigantic deal was blocked by the European Commission and contributed towards the exit of Schwimmer's predecessor, Frenchman Xavier Rolet, in November 2017.

That marked the third failed attempt at a tie-up between the British and German stock exchange operators.

American Schwimmer then took the top job at the LSE, after a 20-year career with US banking behemoth Goldman Sachs.

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