Guinness Peat Group, the finance house - chaired by Sir Ron Brierley - that is opposed to the merger between the London Stock Exchange and Deutsche Borse, is likely to increase its stake in the LSE if limits on share ownership are lifted.
In his first comment since GPG bought a stake of about 1 per cent in the LSE last month, Sir Ron, one of the most controversial corporate raiders of the past 40 years, said the company wanted to increase its influence over the future ownership of the London exchange.
The LSE's proposed merger with its Frankfurt rival to form the iX exchange was put on hold this week after OM Group, the Swedish technology company, initiated a hostile cash-and-share bid for the British exchange.
It was immediately rejected by the LSE board.
OM is expected to publish its offer document next week, a move that could prompt other bidders to act.
In an interview yesterday, Sir Ron said GPG "was unlikely to be a bidder for the LSE but could have a role to play in securing the proper value for the exchange".
He has argued that the merger with Deutsche Borse undervalues the LSE and that the OM offer does not contain enough cash.
He said, however, that any increase in GPG's stake was unlikely before the lifting of current rules that restrict shareholders to a maximum holding of 4.9 per cent.
The limit was introduced when the LSE demutualised earlier this year to fend off predators and to keep a broad shareholder base.
The OM offer is conditional on the lifting of the restrictions.
Sir Ron, who admitted never having heard of OM before this week, said the lifting of the restriction, which needs to be approved by LSE shareholders, could pave the way for other bidders to come forward.
"If the artificial restrictions were removed, the LSE shares would be cheap," he said.
The LSE shares, traded on a special market run by the stockbroker Cazenove, have risen from £23.50 sterling (€38.2) last Friday, when the OM bid was revealed, to yesterday's £28.75, a slight discount to OM's offer.
OM is offering £7 in cash and 0.65 in new shares for each LSE share.
The Swedish group's stock has risen 17 per cent in the past week, increasing the value of its LSE bid from £808 million to £900 million.
Potential counterbidders include a "white knight" offer from Deutsche Borse, possibly backed by the Milan and Madrid stock exchanges.
Others include Euronext, formed by the merger of the Paris, Brussels and Amsterdam bourses.
Nasdaq, the technology-focused US exchange that is planning to join iX, could also mount a counterbid and has raised the possibility with shareholders. Irish stockbroking firms are in line for a windfall of more than £3.5 million (€4.4 million) if the bid from OM Group succeeds. Most Irish stockbroking firms are among the 300 shareholders in the London Stock Exchange.
All the LSE shareholders have equal shareholdings apart from a few brokers who acquired other brokers who had stakes in the exchange. That means the big Irish brokers will receive exactly the same as the small stockbroking partnerships if the Swedish bid succeeds.
