The battle to control the London Stock Exchange widened at the weekend as the Euronext group of continental stock markets was reported to be in talks with French banks to help finance a possible bid.
According to a British newspaper report Euronext, the exchange to result from the merger of the Amsterdam, Brussels and Paris bourses, was believed to have held talks with Societe Generale and BNP Paribas about how to fund a bid that could be worth more than £900 million sterling (€1.5 billion).
The report quoted people close to the talks as saying Euronext was concerned about how to fund a bid, given that the Euronext merger is not due to be completed until September 22nd.
"Euronext is said to have called in the banks to look at ways of raising money, possibly through a debt issue, if it needs to move swiftly to make a counter bid," the report said.
At the end of August Euronext said it planned to complete its own merger before looking for other partners. The report followed Saturday's statement by the Milan bourse that it wanted to join with the LSE and Deutsche Borse, which together aim to create the iX bourse.
The Milan bourse said the question of a "superbourse" counterbid to the hostile bid for the LSE by OM Gruppen, the company that runs the Stockholm Stock Exchange, was still evolving.
Officials at the Amsterdam and Brussels bourses declined to comment on the report, but an Amsterdam spokesman said Euronext was still interested in a link-up with the LSE.
OM's bid was worth just over £800 million when it was launched more than a week ago, but by Friday it was worth just over £900 million on the back of OM's share price rise.
The bid had been expected to prompt offers from other rivals, including Euronext and the US Nasdaq market.
To help rescue its iX merger, Deutsche Borse has raised the prospect of a counterbid that includes Europe's leading southern exchanges, Milan and Madrid.
Mr Massimo Capuano, chief executive of Borsa Italiana, said talks on Friday between the London, Frankfurt, Madrid and Milan bourses had taken a "pragmatic" approach to the takeover affair.
"The situation is evolving. We are still interested in the iX project," Mr Capuano said. "We like being courted but we also like being the ones doing the courting. We have our own cards to play and we know how to make ourselves valued," he said.
Mr Capuano declined to say whether Deutsche Borse had made a specific approach to Milan about taking part in a counterbid.
A British newspaper reported yesterday that the LSE and Deutsche Borse were trying to persuade the US Nasdaq market to agree on an early binding co-operation pact. The plans for iX already include co-operation with Nasdaq.
"The LSE is not looking for white knights. The right deal with Nasdaq would be attractive and a number of LSE shareholders would like to see that happen," the report quoted an unnamed person with knowledge of those talks as saying.
"It is a question of moving from memorandum of understanding to something binding," the source said. Others said to be potential bidders for the LSE include Instinet, the electronic broking arm of Reuters. Reuters declined to comment on the report.
