Nasdaq increases LSE shareholding to 24.1%

In the first of two transactions, Nasdaq bought 10.3 million shares in the UK business for £128.4 million, which increased its stake in LSE to 22.7%.

But the US exchange quickly followed this transaction with the acquisition of a further 3.5 million shares for £43.7 million, bringing it's total shareholding in the LSE to 24.1%.

Nasdaq was already the LSE's biggest shareholder after buying a 14.99% stake in the UK market operator in April, less than two weeks after dropping its £2.43bn cash bid for the LSE. The US exchange increased this stake to 18.7% last week when it bought another 9.79 million shares for £119.2 million.

In a statement, Bob Greifeld, president and CEO, Nasdaq, says: "We are pleased to have increased our strategic stake in LSE through this significant purchase, which takes us through the important threshold of 20%. We look forward to working constructively with LSE as its largest shareholder."

Nasdaq says it bought 10.3 million shares for 1248 pence each. LSE shares rose 10.00 pence to 1254.50 pence in afternoon trading on the news.

Earlier this week rumours surfaced that former LSE suitor Euronext was holding merger discussions with both The New York Stock Exchange and The Chicago Mercantile Exchange (CME).

Euronext is currently holding merger talks with Deutsche Börse but has asked shareholders attending its AGM to vote against a resolution proposed by Winchfield Holdings that a tie-up with German exchange is in the best interests of shareholders because it is "concerned not to restrict its flexibility during this period".

So far US proxy research firm Institutional Shareholder Services (ISS) has backed Euronext in calling for shareholders to reject the motion, saying at this point in time "there is not yet enough information regarding implications on strategy, finances, and corporate governance to allow an informed vote on the merits of a potential merger/acquisition".