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LSE to promote Borsa Italiana inventory trade

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LONDON — The London Stock Exchange on Friday agreed to promote Milan’s Borsa Italiana inventory trade to Euronext for 4.three billion euros ($5 billion).

LSE confirmed it had entered unique discussions with pan-European bourse operator Euronext in regards to the sale of the Borsa Italiana group final month.

It comes after LSE reached definitive phrases to buy information supplier Refinitiv for $27 billion. The European Commission, the EU’s govt arm, has opened an in-depth investigation to contemplate the phrases of the proposed transaction.

The sale of Borsa Italiana relies on, amongst different issues, the Refinitiv transaction going via.

“We continue to make good progress on the highly attractive Refinitiv transaction and we are pleased to have reached this important milestone,” David Schwimmer, CEO of LSE Group, stated in a press release on Friday.

“We believe the sale of the Borsa Italiana group will contribute significantly to addressing the EU’s competition concerns,” he added.

LSE stated it expects to finish the Refinitiv deal by the top of 2020, or early 2021, with the Borsa Italiana transaction set to undergo within the first six months of subsequent 12 months.

Shares of LSE have been up round 0.2% shortly after the opening bell, with Euronext up greater than 0.7% on the information.

“We look forward to embarking on the next phase of our history, working in partnership with Euronext, CDP Equity and Intesa Sanpaolo to further develop our business and to contribute to the development of European capital markets,” Raffaele Jerusalmi, CEO of Borsa Italiana, stated on Friday.

Pedestrian passes Italy’s Stock Exchange, the Borsa Italiana, which is a part of the London Stock Exchange Group Plc, in Milan Italy, on Thursday, Oct. 8, 2020.

Camilla Cerea | Bloomberg by way of Getty Images

‘Borsa Italiana is not going to be a periphery asset’

The sale of Borsa Italiana to Euronext is seen as politically delicate in Italy resulting from Borsa’s possession of MTS, the bond platform which handles the digital buying and selling of Italian authorities bonds and different forms of fastened earnings securities. 

Euronext has partnered with Italy’s largest financial institution Intesa Sanpaolo and state company CDP in an try and safe the backing of Rome’s authorities.

 Stephane Boujnah, CEO and chairman of the managing board of Euronext, described the deal as a “significant achievement” within the agency’s strategic plan, “and a turning point in our Group’s history.”

Speaking to Class CNBC in a while Friday afternoon, Boujnah which fast to play up the significance of Borsa Italiana as soon as the transaction is finalized. 

“Italy will be the latest contributor to the Euronext group, When you are the largest contributor to any company you are very important. And there is no success of Euronext going forward, without the success of Borsa Italiana,” he stated. “Borsa Italiana will not be a periphery asset in a large group.”

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