Euronext and Italy's CDP confirm talks to bid for Borsa Italiana

London

EURONEXT and Italy's Cassa Depositi e Prestiti (CDP) confirmed on Friday they were in talks to make a joint bid for Borsa Italiana, with rival offers from Swiss exchange Six and Deutsche Boerse also in the offing.

The London Stock Exchange (LSE), which bought the Milan-based stock exchange in 2007 for 1.6 billion euros (S$2.6 billion), is now trying to sell it as part of antitrust remedies to help get its US$27 billion takeover of Refinitiv over the line.

Data provider Refinitiv is 45 per cent owned by Thomson Reuters, which is the parent company of Reuters News.

Pan-European exchange Euronext and CDP will face competition from Switzerland's Six and Deutsche Boerse, which are both planning their own bids for Borsa Italiana, three sources familiar with the matter said.

The three bids are expected to land on Friday, meeting an initial deadline set by LSE, a fourth source said.

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The LSE, Six and Deutsche Boerse declined to comment.

The LSE has already received separate bids for Borsa's bond trading platform MTS and will need to decide whether it wants to break up Borsa or opt for an outright sale, this source said.

The Italian Treasury is playing kingmaker as so-called golden power legislation means it can block any unwanted takeover of Borsa, deemed a key asset by Italian lawmakers.

"Rome is an important part of the discussions. LSE will do everything to keep Rome happy. But it won't sell Borsa on the cheap," the fourth source said.

The Italian government is firmly against a break-up of Borsa and wants to have a say over its future strategy and management, several sources have said.

Reuters reported on Thursday that Euronext had granted CDP significant influence in the combined business to secure an alliance with the Italian state agency.

CDP is set to take a stake of around 8 per cent in Euronext, equalling that held by French state investor Caisse des Depots et Consignations, sources have said. REUTERS