The failed Deutsche Börse bid for the London Stock Exchange (LSE) may have made the Börse’s CEO Werner Seifert weep but at least it gave pundits and financial markets analysts an object lesson in just about everything.
It neatly illustrated the weaknesses of a one-trick-pony business model for exchanges. The LSE may be the biggest and most profitable standalone stock exchange in Europe, but this offered little bargaining power against a bigger, more diversified rival. Had the Börse’s investors been more sympathetic to the idea, the German exchange’s clout would have sealed the deal.