May 3: Nasdaq raises its stake in the LSE
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
May 3: The options for the London Stock Exchange narrowed a little today as Nasdaq raised its shareholding to 18.7 per cent. This will make it harder for the NYSE Group to bid for the LSE by increasing both the size of its rival’s blocking stake and the price it would have to pay. Also, the prospects of a deal between London and Euronext ended today when the European exchange ended merger talks with the LSE: its shareholders never liked the deal, even if that was where both managements’ hearts lay. Nasdaq paid £12.18 a share for the extra 3.8 per cent it has just bought, setting a new floor to what it must pay if it decides to bid for the LSE. It paid £11.75 for its original 14.99 per cent. LSE shares are up about 2 per cent at £12.46, valuing the group at about £3.1bn.
The other big story of the day is that EMI has made a $4bn cash and shares takeover approach for Warner Music, home to Madonna and James Blunt. Not much sound, however, of You’re Beautiful from Warner, which rejected EMI’s overtures. This is at least the third attempt to get the two companies together since 2000. However, none of the mood music so far today suggests this is the end: the logic is too compelling and there are few more obvious buyers to take Warner Music off its private equity owners. We’ll devote quite a bit of space tomorrow to the rationale for a deal, where EMI goes now and the possible regulatory issues. Among the bloggers, there is some useful commentary at paidcontent.org. Better still, read Lex online.
Debenhams shares will be priced tonight. It sounds like we should expect them come out towards the bottom of the 195p-250p range.
We’re also looking at BSkyB’s third quarter results, which show that subscriber growth has slowed. Does this cast doubt over James Murdoch’s strategy? We’ll tell you tomorrow.
BAA has published its defence document to repel Ferrovial but it’s hard to get too excited. As you might expect, the group is emphasising how much capital expenditure it is committed to.
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