How do the potential bidders for the LME stack up?

May 02, 2012 | 08:57 AM |

Four exchanges – CME Group, InterContinental Exchange (ICE), NYSE Euronext and the Hong Kong Exchange – have emerged as contenders for the London Metal Exchange, which set a deadline for bids of May 7. Metal Bulletin outlines some of the salient issues in this fascinating takeover story, which has at its centre the 134-year-old LME, the world’s largest metal market – a prize asset in the global consolidation of exchanges. What are the assets and advantages the three USA-based exchanges and the Hong Kong exchange could offer to shareholders of the world’s largest metal market? Why are they are interested? What questions will board members, shareholders and current users of the market be asking as the deadline approaches as they weigh which exchange makes the best financial offer? Which offers the most compelling vision for the LME’s future? And which has the best people? CME Group Market capitalisation: $17.8 billion Who? CME Group, owner of the Chicago Mercantile Exchange, the Chicago Board of Trade (which it won after a battle with ICE in 2007), Comex and Nymex, is being tipped by some as the front-runner in the bidding process. Alongside copper and precious metals contracts, it offers trading in interest rates, equity indices, foreign exchange, energy, agricultural commodities, weather and real-estate contracts. By its reckoning, CME Group offers the “widest range of global benchmark products across all major asset classes”, and it has been increasing its footprint in Asia in recent months with a strategic partnership with Bank of....

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