London Stock Exchange
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The Source by Greyworld, in the new LSE building |
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Paternoster Square. The LSE occupies the building that takes up much of the right side of this picture. |
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Former LSE premises in Threadneedle Street |
The
London Stock Exchange (
LSE) is a
stock exchange located in
London. Founded in
1801, it is one of the largest stock exchanges in the world, with many overseas listings as well as UK companies. It traces its history to
1697 when
John Castaing, stationed at an office in
Jonathan's Coffee-House, published the prices of stocks and commodities called
The Course of the Exchange and other things.
Its motto is
dictum meum pactum, "My word is my bond".
[A piece of trivia: Upon occasion, financial companies will decide to use this motto. They only know the English "My word is my bond"; and, due to the difficulty of locating the original Latin motto (from which the English version is taken), produce a fake coat of arms for their business embellished with the Latin motto verbum meum pactum. At first sight, this seems O.K. but, sadly for them, whilst dictum meum pactum very definitely means "The words that come out of my mouth are my bond", the contrasting motto verbum meum pactum, in this context, means "The words that I write on a page are my bond"; and, as a consequence, they are warning their customers that "Nothing that I say can be trusted".]The former
Stock Exchange Tower, based in
Threadneedle Street/Old Broad Street was opened by
Queen Elizabeth II in
1972 and housed the Trading Floor where traders would traditionally meet to conduct business. This became largely redundant with the advent of the
Big Bang on
27 October 1986, which deregulated many of the Stock Exchange's activities. It eliminated fixed commissions on security trades and allowed securities firms to act as brokers and dealers. It also enabled an increased use of computerised systems that allowed dealing rooms to take precedence over face to face trading.
On the 20th July
1990 a bomb planted by the
IRA exploded in the men's toilets behind the visitors' gallery. The area had already been evacuated and nobody was injured
http://news.bbc.co.uk/onthisday/hi/dates/stories/july/20/newsid_2515000/2515667.stm. The long term trend towards electronic trading had been reducing the Exchange's status as a visitor attraction and although the gallery reopened it was closed permanently in
1992.
In July
2004 the London Stock Exchange moved from
Threadneedle Street to
Paternoster Square (
EC4) close to
St Paul's Cathedral, still within the "Square Mile" (the
City of London). It was officially opened by Queen Elizabeth II once again, accompanied by The
Duke of Edinburgh, on
27 July 2004. The new building contains a specially commissioned dynamic sculpture called "The Source", by artists
Greyworld.
In December of 2005, the LSE rejected a £1.5 billion takeover offer from
Macquarie Bank. The LSE described the offer as "derisory." It then received a bid in March of 2006 for £2.4 billion from
NASDAQ, which was also rejected by the LSE. NASDAQ was said to be preparing a
hostile takeover bid in response, and the
New York Stock Exchange (NYSE) was considered a potential
white knight bidder.
["Nasdaq may go hostile as LSE encourages fresh bidding war." Walsh, C., The Observer. March 12, 2006.] Interest from NASDAQ and the NYSE would likely have been taken more seriously, due to significantly higher financial clout, as well as being more attractive in creating the first
transatlantic equities market. NASDAQ later pulled its bid, and less than two weeks later on
April 11,
2006, struck a deal with LSE's largest shareholder,
Ameriprise Financial's
Threadneedle Asset Management unit, to acquire all of that firm's stake, consisting of 35.4 million shares, at £11.75 per share.
["Nasdaq Acquires 15% of LSE." Patrick, M., Lucchetti, A., Reilly, D., Taylor, E. The Wall Street Journal. April 11, 2006.] NASDAQ also purchased 2.69 million additional shares, resulting in a total stake of 15%. While the seller of those shares was undisclosed, it occurred simultaneously with a sale by
Scottish Widows of 2.69 million shares.
["Scottish Widows says has sold 2.7 mln LSE shares at 1,175 pence." Forbes. April 12, 2006.] The move was seen as an effort to force LSE to negotiate either a partnership or eventual merger, as well as to block other suitors, such as NYSE.
["Nasdaq Buys 15 Percent Stake in LSE for $782 Million." Ortega, E. Bloomberg News. April 11, 2006.] Subsequent purchases have increased NASDAQ's stake to 25.1%, making competing bids very difficult.
["Nasdaq raises LSE stake, making rival bids harder." Goldsmith, B. and Elliott, M. Reuters. May 19, 2006.]The LSE is broken down into the
Main Market and
Alternative Investments Market (
AIM), as well as
EDX London (which handles derivatives). The independent
FTSE Group maintains a series of indices for measuring the LSE, including the
FTSE 100 Index,
FTSE 250 Index, and
FTSE 350 Index.
*Listed companies 2,749 ([
1])
*
Clara Furse*
Market maker*
London Stock Exchange*
Emporis
