The board of the London Stock Exchange was reportedly huddled on Thursday, discussing its possible tie-up with Borsa Italiana.
Directors at the Italian stock exchange are due to hold their own board meeting at lunchtime amid suggestions that the takeover terms offered by the LSE will include some sort of autonomy provision for Borsa Italiana.
Shares in the LSE fell 25p to £13.44 as the market awaited further details.
But one big question needs answering here: will this qualify as a Class One transaction under London’s listing rules. That is, does buying Borsa Italiana pass the 25 percent threshold in terms of the LSE’s assets and/or profits?
If it does — and the numbers being bandied about suggest it might — then the deal will require shareholder approval.
And, in that case, what are Nasdaq, with 30 per cent, likely to do?
Vote it down, we’d guess.
Of course, the LSE may be looking at structuring a deal to avoid a shareholder vote. But then Britain’s Financial Services Authority takes a dim view of firms that try such tactics — and the very rules governing class tests, part of the old Yellow Book, were drawn up by the LSE itself in its previous role as market regulator.