News Column

Stock exchange in pounds sterling 1bn rights issue

August 23, 2014

By Jamie Nimmo, Daily Mail, London

Aug. 23--The London Stock Exchange is planning to tap shareholders for close to pounds sterling 1bn to help fund the acquisition of the Frank Russell index business.

The fully underwritten pounds sterling 938m rights issue has been priced at pounds sterling 12.95 a share, allowing investors to buy three shares for every 11 they currently own.

The remaining pounds sterling 685m needed to complete the pounds sterling 1.6bn acquisition, which will give the LSE ownership of the Russell 2000 small-cap US stock index, will be funded through debt.

The issue price is a 35pc discount to Thursday's closing share price of pounds sterling 20.05. Investors are being offered a relatively small discount on new stock compared with recent acquisitions funded by rights issues. These include Cineworld'spounds sterling 110m fundraising, which was 41pc cheaper than the market price.

The LSE's rights issue will be underwritten by a string of banks, including Barclays, HSBC and Deutsche Bank, which will share the pounds sterling 25m paid by the LSE in fees.

Its shares have risen around 13pc since the Russell talks first emerged in May. Details of the financing were unveiled alongside the group's quarterly financial figures, which showed a 22pc rise in operating profits to pounds sterling 102m in the three months to the end of June.

Chief executive Xavier Rolet put the strong performance down to 'a resurgence in the IPO market'.

The 78 new listings during the quarter raised almost pounds sterling 20bn, more than three times the pounds sterling 6.1bn raised a year ago, lifting primary markets profits by 30pc to pounds sterling 25.3m. Shares in LSE rose 24p to 2029p.


(c)2014 Daily Mail (London, )

Visit the Daily Mail (London, ) at

Distributed by MCT Information Services

For more stories on investments and markets, please see HispanicBusiness' Finance Channel

Source: Daily Mail (London, England)

Story Tools Facebook Linkedin Twitter RSS Feed Email Alerts & Newsletters