LSE's purchase of Refinitiv is set to close in early 2021. The more I research the two companies, the more i'm convinced this deal is a global game-changer in the exchange & data business. A thread to explain:pic.twitter.com/dPAktVvg7l
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LSE's purchase of Refinitiv is set to close in early 2021. The more I research the two companies, the more i'm convinced this deal is a global game-changer in the exchange & data business. A thread to explain:pic.twitter.com/dPAktVvg7l
First, a summary of LSE. Pre-Refinitiv, LSE's business can be grouped into 3 buckets: 50% FTSE Russell - indices & data 40% LCH - swaps & FX clearing 10% Other - cash equities, listings & tech services What is LSE getting w/ Refinitiv?
Refinitiv did $6.3B in 2018 revenue - 3x LSE's.
Key products include:
Eikon: a cheaper Bloomberg terminal
Risk & post trade solutions
FX trading platform FXall
Controlling interest in Tradeweb $TW
Combining with LSE would boost almost every business unit.
Some examples:
Swaps trading (Tradeweb)
Swaps clearing (LCH)
FX trading (FXall)
FX clearing (LCH)
Data delivery (Eikon)
Data creation (FTSE Russell)
ETF trading (Tradeweb)
ETF indices (FTSE Russell)
Risk Solutions (Refinitiv)
Post Trade (LSE)
Eikon may be the #2 terminal to Bloomberg, but it's still a monster in the space. Stats below - 190,000 users (23% market share) at anywhere from $3,600 - $22,000 per year each.pic.twitter.com/EI9vHbF565
TLDR: Don't overlook the LSE Refinitiv deal. Just because it's taking a long time to close doesn't mean the industry impact isn't huge. LSE is buying a crown jewel in Refinitiv, and the benefits of combination should make competitors sweat.
Sources: https://www.lseg.com/sites/default/files/content/documents/LSEG%20Annual%20Report%2031%20December%202019.pdf … https://www.wallstreetprep.com/knowledge/bloomberg-vs-capital-iq-vs-factset-vs-thomson-reuters-eikon/ … https://ir.thomsonreuters.com/static-files/dd5b380d-7e0e-4316-b693-bec293daaece …
This deal could trigger a further round of M&A. Deutsche Börse will certainly try to do a big-ish acquisition. MSCI buying FactSet? Maybe do a thread on possible M&A deals?
Good point, I'll give it some thought
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