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LONDON STOCK EXCHANGE

The London Stock Exchange (LSE) is a stock exchange located in London, England. Founded in 1801, it is one of the largest stock exchanges in the world, with many overseas listings as well as UK companies. It traces its history to 1697 when John Castaing, stationed at an office in Jonathan's Coffee-House, published the prices of stocks and commodities called The Course of the Exchange and other things.

Its motto is dictum meum pactum, "My word is my bond".[1]

The former Stock Exchange Tower, based in Threadneedle Street/Old Broad Street was opened by Queen Elizabeth II in 1972 and housed the Trading Floor where traders would traditionally meet to conduct business. This became largely redundant with the advent of the Big Bang on 27 October 1986, which deregulated many of the Stock Exchange's activities. It eliminated fixed commissions on security trades and allowed securities firms to act as brokers and dealers. It also enabled an increased use of computerised systems that allowed dealing rooms to take precedence over face to face trading.

On the 20th July 1990 a bomb planted by the IRA exploded in the men's toilets behind the visitors' gallery. The area had already been evacuated and nobody was injured [[1]]. The long term trend towards electronic trading had been reducing the Exchange's status as a visitor attraction and although the gallery reopened it was closed permanently in 1992.

In July 2004 the London Stock Exchange moved from Threadneedle Street to Paternoster Square (EC4) close to St Paul's Cathedral, still within the "Square Mile" (the City of London). It was officially opened by Queen Elizabeth II once again, accompanied by The Duke of Edinburgh, on 27 July 2004. The new building contains a specially commissioned dynamic sculpture called "The Source", by artists Greyworld.

Pursuit of LSE by prospective merger partners

In December of 2005, the LSE rejected a £1.5 billion takeover offer from Macquarie Bank. The LSE described the offer as "derisory." It then received a bid in March of 2006 for £2.4 billion from NASDAQ, which was also rejected by the LSE. NASDAQ was said to be preparing a hostile takeover bid in response, and the New York Stock Exchange (NYSE) was considered a potential white knight bidder.[2] Interest from NASDAQ and the NYSE would likely have been taken more seriously, due to significantly higher financial clout, as well as being more attractive in creating the first transatlantic equities market. NASDAQ later withdrew its bid, and less than two weeks later on April 11, 2006, struck a deal with LSE's largest shareholder, Ameriprise Financial's Threadneedle Asset Management unit, to acquire all of that firm's stake, consisting of 35.4 million shares, at £11.75 per share.[3] NASDAQ also purchased 2.69 million additional shares, resulting in a total stake of 15%. While the seller of those shares was undisclosed, it occurred simultaneously with a sale by Scottish Widows of 2.69 million shares.[4] The move was seen as an effort to force LSE to negotiate either a partnership or eventual merger, as well as to block other suitors, such as NYSE.[5] Subsequent purchases have increased NASDAQ's stake to 25.1%, making competing bids very difficult.[6][7][8]

Structure

The LSE is broken down into the Main Market and Alternative Investments Market (AIM), as well as EDX London (which handles derivatives). The independent FTSE Group maintains a series of indices for measuring the LSE, including the FTSE 100 Index, FTSE 250 Index, and FTSE 350 Index.

Levels

  • Listed companies 2,749 ([2])

See also

External links

Notes

  1. ^ A piece of trivia: Upon occasion, financial companies will decide to use this motto. They only know the English "My word is my bond"; and, due to the difficulty of locating the original Latin motto (from which the English version is taken), produce a fake coat of arms for their business embellished with the Latin motto verbum meum pactum. At first sight, this seems O.K. -- for this Latin motto also means "My word is my bond" -- but, sadly for them, whilst dictum meum pactum very definitely means "The words that come out of my mouth are my bond", the contrasting motto verbum meum pactum, in this context, means "The words that I write on a page are my bond"; and, as a consequence, they are warning their customers that "Nothing that I say can be trusted".
  2. ^ "Nasdaq may go hostile as LSE encourages fresh bidding war." Walsh, C., The Observer. March 12, 2006.
  3. ^ "Nasdaq Acquires 15% of LSE." Patrick, M., Lucchetti, A., Reilly, D., Taylor, E. The Wall Street Journal. April 11, 2006.
  4. ^ "Scottish Widows says has sold 2.7 mln LSE shares at 1,175 pence." Forbes. April 12, 2006.
  5. ^ "Nasdaq Buys 15 Percent Stake in LSE for $782 Million." Ortega, E. Bloomberg News. April 11, 2006.
  6. ^ MacDonald, A.; Lucchetti, A., "In LSE Stakes, Nasdaq Advances, Euronext Falls", The Wall Street Journal, 2006-05-04.
  7. ^ Lucchetti, A.; MacDonald, A., "Nasdaq Lifts Its LSE Stake to 24%", The Wall Street Journal, 2006-05-11.
  8. ^ "Nasdaq raises LSE stake, making rival bids harder." Goldsmith, B. and Elliott, M. Reuters. May 19, 2006.