Hong Kong Phooey
A tip of the hat to the Headland Consultancy, on the ticket today for the slightly amazing £32 billion bid by Hong Kong for the London Stock Exchange.
Headland has got some experienced old pros on hand and might genuinely disrupt the Finsbury/Brunswick/Tulchan stranglehold on such big takeovers.
It could sincerely challenge the league tables. And it briefs well. It gets what hacks want.
If it does help HKEX land this deal it will have earnt every penny, but my best guess is it won’t.
Headland offered a bunch of perfectly plausible strategic benefits for the merger, but none of them really make the case crystal clear.
Foreigners have been trying to buy the LSE since forever, and there’s no clear reason why Hong Kong should win where Sweden, Germany, Australia, the USA and the Canadians failed.
Even if the deal makes sense to shareholders – a big if – I can’t really see why it makes sense for customers.
The gains from trading synergies could surely be achieved without a corporate merger that would be messy and disruptive.
I expect the gist of the City commentary tomorrow on this deal to be mostly negative. London could perhaps buy Hong Kong. But them buying London?
Work to do then. Let the £32 billion battle of the spinners begin…
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