EU: London backs Deutsche Börse and LSE to resist Frankfurt base

London is backing Deutsche Börse and the London Stock Exchange Group in resisting German pressure to reopen the exchanges’ planned merger and force the combined company to be based in Frankfurt.

The deal to create a €28bn European heavyweight has been given high level blessing by both the German and UK governments in the past and Downing Street insiders said they saw “no reason” why the deal agreed by shareholders should be reviewed.

Any suggestion that the headquarters be switched from London to Frankfurt because of Brexit would be politically problematic for Theresa May, the UK prime minister, who is attempting to play down the risk to the City of London of life outside the EU.

The regional government of Hessen, which regulates Deutsche Börse, is adamant that it should host the headquarters.

Michael Boddenberg, head of the ruling Christian Democrats in the Hessen regional assembly said it was “sensible” to apply certain conditions. “The central conditions are as follows: the seat of the joint exchange holding company after a possible merger of Deutsche Börse, and the London Stock Exchange must be Frankfurt and the financial base in Frankfurt and the development of Deutsche Börse in international competition must be strengthened through the merger . . . . After the vote of the UK to leave the EU it is in our view ruled out that London can be considered as the [combined company’s] seat.”

Full Content: Financial Times

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