The London Stock Exchange (LSE) has rejected a take-over bid by US stock exchange Nasdaq.
This is the second time that the LSE has rejected advances from Nasdaq, which built up a 25 per cent stake in the LSE after a previous bid was rebuffed. The US stock exchange was offering to pay £12.43 a share in cash for the rest of the company, valuing Europe's biggest stock market at about £2.7 billion sterling (€3.9 billion).
That was 40 per cent above Nasdaq's previous offer in March but close to the level at which the second-biggest US stock market paid for most of its stake.
However, the offer was rejected as inadequate.
"Nasdaq's final offer fails to recognise the outstanding growth record and prospects of our group on a standalone basis let alone the Exchange's unique global position," chief executive Clara Furse said in a statement.
If it had been accepted, the deal would have created the world's biggest exchange by number of listings, including over 6,400 companies with a market value of $11.8 trillion (€8.6 trillion), as well as the most active exchange with an average daily volume of 7.4 billion shares traded.
The world's stock markets are rushing to consolidate, under pressure from customers to cut fees and offer global services. A group of banks added to the pressure last week by announcing plans to create their own pan-European equity trading platform next year.
The LSE has long been viewed as a takeover target because it is a relatively small company, compared with many of its rivals which have branched into other trading platforms. However, the firm has rejected approaches from all of its suitors to date.