London Stock Exchange picked a bad year to join a pan-European project

The marriage of the London Stock Exchange and Deutsche Börse may not be stone dead but that’s the way to bet, as Damon Runyan would have said. This so-called ‘merger of equals’ — with the Germans holding the larger stake and the top job but with the head office in London, at least to begin with — has foundered over a demand from EU competition authorities that the LSE should sell its majority stake in MTS, an Italian bond-trading platform. Having had its alternative proposal (to sell a French clearing operation) rejected, the LSE refused to comply, allegedly without first consulting its German partners.

When this deal was announced a year ago, I opined that the German motivation behind it ‘must be to hoover as much business as possible from London to Frankfurt’. An LSE insider insisted I was wrong, that the synergies would be beautiful and that the omens were harmonious because LSE chief Xavier Rolet and Börse boss Carsten Kengeter ‘used to work together at Goldman Sachs’.