UK watchdog clears London Stock Exchange’s takeover of Quantile

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Britain’s competition watchdog said on Wednesday it had cleared London Stock Exchange Group’s (LSEG) takeover of Quantile Group after an in-depth investigation.

The Competition and Markets Authority (CMA) concluded that the deal did not raise substantial competition concerns in Britain.

LSEG agreed to buy Quantile last year for up to 274 million pounds ($314 million) to expand its range of post-trade risk management solutions for banks, hedge funds and financial institutions trading derivatives.

During a so-called Phase 2 investigation, the CMA engaged with customers of LSEG and Quantile as well as third-party interest rates compression providers who replace multiple offsetting derivatives contracts with fewer deals of the same net risk to reduce the notional value of a given portfolio.

“On the basis of that engagement and other evidence we have gathered, we are satisfied that this deal will not worsen the options available to businesses and consumers,” said Martin Coleman, chair of the CMA’s independent inquiry group.

For LSEG, which holds a majority stake in the LCH clearing house group, the deal is instrumental to strengthening its post-trade business which provides clearing services for over-the-counter derivatives.

Quantile was co-founded in 2015 by Stephen O’Connor, a former Morgan Stanley banker who used to chair the International Swaps and Derivatives Association.

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