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LME to weigh bids on more than just money

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When the London Metal Exchange board assesses bids after the May 7 deadline for submissions, it will consider how the suitors plan to operate the exchange and the benefits they can offer to users, as well as the outright price they are willing to pay for the LME, Metal Bulletin understands. 

Four exchanges are expected to make bids – ICE, CME Group, NYSE Euronext and the Hong Kong Exchange – and the LME has now heard presentations from the bidders in support of their proposals.

Once the final bids are received, they will be reviewed firstly by the bid committee and then passed on to the LME board for full consideration. The board’s aim is to present only one of the bids to shareholders.

Alongside the value the bidders place on the exchange, the LME board will consider how the potential buyer proposes to operate the market, including their plans for the ring, the date structure of LME contracts and the warehousing system, for example, Metal Bulletin understands.

The LME will also consider the expertise bidders can bring to further strengthen the LME’s role in the metal markets, which may include systems development or access to certain customer types in specific regions of the world.

The schedule to review and present bids to shareholders will be finalised once bids have been received. As of midday on Wednesday May 3, no bids had been submitted.

Mark Burton
mburton@metalbulletin.com
Twitter: @mburtonmb

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