Investing.com - London Stock Exchange Group (LON:LSE) surged 15% to an all-time high on Monday in response to a deal that will transform its position in the global market for financial data.
The LSE said at the weekend it was in talks to buy Refinitiv, the data arm of what used to be known as Thomson Reuters, in an all-share deal that valued Refinitiv at $27 billion, including debt. Refinitiv’s shareholders, led by majority owner Blackstone (NYSE:BX) Group, would receive a stake of around 37% in the combined company.
The London-based group wants Refinitiv for what it called “sophisticated data content and analytics provided on flexible and open platforms,” including the Tradeweb platform that IPOed earlier in New York this year and the FXall platform for foreign exchange trading.
“A leading financial markets infrastructure provider must operate globally and across asset classes, with data management, analytics and distribution capabilities that can serve customers across asset classes and geographies,” LSE said.
It’s a stunning coup for a company that has repeatedly defied the strategic challenges thrown up in recent years by changing trends in financial markets and, latterly, by Brexit, and should put to rest any lingering doubts about the company’s future in the wake of the departure of its talismanic chief executive Xavier Rolet at the end of 2017.
However, it’s not the only deal in town this morning. Just Eat (LON:JE), the food delivery company, was up 26% after getting a 5 billion-pound bid from Takeaway.com, in the latest example of consolidation in the food delivery sector. Just Eat’s shares rose to 791 pence a share, nearly 10% above the 731p offered by the Dutch-based group, suggesting that at least some participants expect a counterbid to drive the price higher, after the two companies announced an “agreement in principle” to merge.The deals have helped propel the FTSE 100 1.1% higher (although another sharp Brexit-related drop in the British pound is also contributing). The benchmark Stoxx 600 was up less than 0.1%, while most continental indexes were down, also in part due to concerns that Brexit will hit the EU economy as well as the U.K. one.
Elsewhere, Ryanair's (LON:RYA) shares held steady as the company upheld its guidance for the fiscal year ending in March 2020, despite shrinking margins, more intense competition in Germany, delays to the receipt of its 737 MAX airplanes from Boeing (NYSE:BA) – and, of course, Brexit. The airline’s net profit fall over 20% year-on-year in the first quarter, even though it raised revenue and passenger numbers by 11%. Margin pressure has become intense in Europe as the economy has slowed. That has wrong-footed Europe’s airlines, which spent heavily on building capacity in the hope that the European economy was pulling out of a long period of below-par growth in the wake of the euro crisis.
Also of note on Monday, shares in Dutch brewing giant Heineken (AS:HEIN) fell over 5.3% after its earnings came in below expectations, eroded by higher costs, especially in emerging markets. Sales in its home market of Europe continued their gradual decline caused by changing consumer tastes.