Spiegel Online – Is the London Stock Exchange really worth $5 billion? Or even $6 billion?
A number of investors, particularly hedge funds, are now piling into the shares of the London exchange on expectations that Nasdaq’s pursuit of the exchange will lead to a rich buyout.
Some see a takeover price of 1,500 pence a share – nearly four times the London exchange’s trading price two years ago, and 20 percent higher than Nasdaq’s offer of $5.1 billion, or 1,243 pence a share – which Nasdaq called a final offer for the 71 percent that it does not own. The offer was announced on Monday.
There is other hedge fund money, however, that is shorting shares of the London exchange, in essence betting on the opposite outcome: that there will be a meltdown in negotiations, resulting in no deal at all, and a sharp drop in the stock price of the London exchange.
The bulls – and the belief that the London exchange will be acquired at a higher price – are gaining ascendancy after Samuel J. Heyman, the 1980s corporate raider best known for his $5 billion takeover of the chemical giant GAF, said that his investment companies – Heyman Investment Associates and Vesper Holdings – had amassed an 8.8 percent stake in the London exchange. They did so by paying as much as 1,290 pence a share for the stock, according to a filing on Tuesday.
