The combination of LSEG and Refinitiv is not expected to cause any harm to competition or US consumers, found the US Department of Justice


London Stock Exchange signed a deal in August 2019 to acquire Refinitiv. (Credit: London Stock Exchange/Wikimedia Commons)

The US Department of Justice (DOJ) said that its antitrust division has closed its antitrust investigation into the London Stock Exchange Group’s (LSEG) $27bn acquisition of Refinitiv, clearing it without any conditions.

According to the DOJ, its antitrust unit after undertaking an extensive review of the proposed deal ruled that the combination of the two companies is not expected to cause any harm to competition or US consumers.

LSEG is the operator of the London Stock Exchange, Borsa Italiana, which is the Italian stock exchange, and other trading platforms. Through its FTSE Russell business, the group offers indexes such as the FTSE 100 and Russell 2000, data solutions, and analytical tools.

On the other hand, Refinitiv is a provider of financial markets data and infrastructure. The firm caters to financial industry professionals with real-time and non-real time data feeds of stocks and other discrete content, and desktop solutions and terminals. Besides, it offers foreign exchange benchmarks and controls various electronic trading venues in multiple asset classes.

The US Department of Justice stated: “The division’s analysis considered how changes in the licensing of LSEG’s and Refinitiv’s proprietary data feeds could affect competition for financial indexes and financial data products, and found that the proposed transaction is unlikely to significantly lessen competition for those products where rivals rely on LSEG and Refinitiv for inputs.”

LSEG said that it has secured various other antitrust and foreign investment approvals for its proposed deal, while continuing to make progress on the remaining clearances and approvals that are needed for its closing.

The deal, which was signed in late 2019, is anticipated to be closed by the year-end or early next year, said LSEG.

LSEG’s acquisition of Refinitiv facing hurdles in the European Union and Singapore

In June, the European Commission launched an in-depth phase 2 probe into the transaction citing that it could hurt the competition in trading and clearing of various financial instruments and in financial data products.

Last month, Competition and Consumer Commission of Singapore (CCCS) said that it will proceed with a phase 2 review into the deal on the grounds of competition concerns.

Meanwhile, to address the concerns of the European Commission, LSEG said that it has started exploratory discussions which could lead to a sale of its stake in MTS or possibly the Borsa Italiana group as a whole. The stock exchange group said that there can be no assurance that it will decide to move ahead with a deal pertaining to either of the two businesses.