The leading knowledge platform for the financial technology industry
The leading knowledge platform for the financial technology industry

A-Team Insight Blogs

Could EU Probe of LSE’s Refinitiv Acquisition Force Spin-Off of TradeWeb?

The European Commission’s investigation into the London Stock Exchange’s proposed $27 billion acquisition of Refinitiv under the EU Merger Regulation – announced this week – will examine potential competitive issues stemming from the parties’ respective ownership of market-leading European government bond trading platforms MTS and TradeWeb, respectively.

The commission says it has ‘horizonal concerns’ about the fact that the LSE’s MTS and Refinitiv’s Tradeweb platforms together would constitute “a very large combined market share in the electronic trading of European Government Bonds.”

The commission says “the parties own venues with a leading position in the market, and are close competitors in this space, in particular regarding trading between dealers and investors. The market investigation also suggests that it is difficult for a new trading venue to attract clients in sufficient numbers and become a real alternative to incumbent venues.”

Should it find evidence that the transaction would hurt competition in electronic trading of government bonds, the commission could push for divestiture of one or other of the two platforms before giving the deal the green light, with Tradeweb the more likely of the two to be spun off.

The future of TradeWeb has been in question since current Refinitiv owner BlackStone’s initial acquisition of the vendor, with market speculation at the time suggesting the private equity firm could sell off Tradeweb to fund a significant portion of the Refinitiv purchase. That sale never materialized but the EU competition enquiry could force a rethink.

The commission says it will now “carry out an in-depth investigation into the effects of the transaction to determine whether its initial competition concerns are confirmed.” It says it was notified of the transaction on May 13, and has 90 working days to take a decision on or before October 27.

Related content

WEBINAR

Recorded Webinar: Market data management, licensing and administration in the post-Covid environment

Market data administration has always been a challenge. For many firms, keeping tabs on permissioning and entitlements, compliance with licensing agreements, and reconciling all that with increasingly complex invoices requires a significant dedicated resource with a clear understanding of the issues involved. As if that weren’t enough, things got more challenging for these teams in...

BLOG

TP ICAP Sets Up Parameta Solutions as New Brand for Data, Analytics and Post-Trade Offerings

TP ICAP has set up a new business, Parameta Solutions, to provide a flagship brand for its data and analytics division. It is due to be opened officially next week. Parameta’s data and analytics offerings will include unbiased OTC content and proprietary data, in-depth insights across price discovery, risk management, benchmarks and indices, and pre...

EVENT

TradingTech Summit Virtual

TradingTech Summit (TTS) Virtual will look at how trading technology operations can capitalise on recent disruption and leverage technology to find efficiencies in the new normal environment. The crisis has highlighted that the future is digital and cloud based, and the ability to innovate faster and at scale has become critical. As we move into recovery and ‘business as usual’, what changes and technology innovations should the industry adopt to simplify operations and to support speed, agility and flexibility in trading operations.

GUIDE

Trading Regulations Handbook 2021

In these unprecedented times, a carefully crafted trading infrastructure is crucial for capital markets participants. Yet, the impact of trading regulations on infrastructure can be difficult to manage. The Trading Regulations Handbook 2021 can help. It provides all the essentials you need to know about regulations impacting trading operations, data and technology. A-Team Group’s Trading...