The £21bn merger between the London Stock Exchange and its German rival Deutsche Börse has fallen apart after it was blocked by the European commission on the day that Britain served notice on its EU membership.

Margrethe Vestager, the EU competition regulator, said the deal between the London and Frankfurt exchanges would create a “de facto monopoly in the crucial area of fixed income instruments”.

The commission’s opposition ends a deal that had been in the making for 13 months. LSE Group and Deutsche Börse had pledged to press ahead with the deal even after Britain voted to leave the EU last June, but this is the third failed attempt at a merger between the two companies after previous setbacks in 2000 and 2005.

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The proposed tie-up had been criticised across Europe, including in France, Belgium, Portugal and the Netherlands, which were concerned about the future of their own exchanges. Critics in Frankfurt also questioned why the enlarged company was going to be based in London given Deutsche Börse would have held 54.4% of the shares in the group and Britain is leaving the EU.

Shares in LSE Group rose as much as 3% after the announcement as investors in the company breathed a sigh of relief at the end of the saga.

The merger has been in doubt since LSE announced last month that the commission was unlikely to provide clearance for the merger unless it sold its Italian trading arm, MTS, to ease competition concerns.

Vestager confirmed on Wednesday that LSE and Deustche Börse had refused to meet her requests to offset concerns about competition.

She said: “The European economy depends on well-functioning financial markets. That is not just important for banks and other financial institutions. The whole economy benefits when businesses can raise money on competitive financial markets.”

Referring to the exchanges’ key role in the bond market, she added: “The merger between Deutsche Börse and the London Stock Exchange would have significantly reduced competition by creating a de facto monopoly in the crucial area of clearing of fixed income instruments. As the parties failed to offer the remedies required to address our competition concerns, the commission has decided to prohibit the merger.”

Vestager said her decision was not affected by the prospect of Brexit, and that any future deals involving the LSE and Europe would still be reviewed.

“We deal with any company who has a footprint in the European market, because we want competition in the European market, no matter your flag and no matter your ownership. That goes for everyone,” she said.

In a statement, LSE Group expressed its disappointment at the decision and confirmed the agreement between the companies had been terminated. It had agreed to offload its French clearing business, LCH, to the European exchange Euronext for €510m (£443m) to help smooth the passage of the merger.

LSE Group said: “LSEG believes the proposed merger with Deutsche Börse in combination with the LCH SA remedy [the sale of LCH] would have preserved credible and robust competition in all markets.

“This was an opportunity to create a world-leading market infrastructure group anchored in Europe, which would have supported Europe’s 23m SMEs and the development of a deeper capital markets union.”

However, LSE Group said it was “confident in its prospects as a standalone business and its strategy for growth continues to deliver strong results”. It said it would press ahead with the return of cash to shareholders that it had promised as part of the Deutsche Börse deal.

“Accordingly, LSEG now plans to initiate an on-market share buyback of £200m, an amount broadly equivalent to the return it would have made had the merger with Deutsche Börse proceeded as planned,” LSE Group said.

“LSEG continues to be actively engaged in exploring selective inorganic and ongoing organic investment in order to drive further growth and will continue to consider opportunities for further capital returns in line with its capital allocation framework.”</s>The European Commission has blocked the proposed £21bn merger of the London Stock Exchange and its German rival Deutsche Börse, ending the proposed tie-up on the day that Britain officially requests to leave the EU.

Margrethe Vestager, the EU competition regulator, said the deal between the two exchanges would create a “de facto monopoly in the crucial area of fixed income instruments”.

The EC’s opposition ends a deal that has been in the making for 13 months. LSE and Deutsche Börse had pledged to press ahead with the deal even after Britain voted to leave the EU last June. This was the third attempt at a merger between the two companies after failures in 2000 and 2005.

However, the merger has been in doubt since LSE announced last month that the EC was unlikely to provide clearance for the merger unless it solds its Italian trading arm MTS to ease competition concerns.

Vestager confirmed on Wednesday that LSE and Deustche Börse had refused to meet her requests to offset concerns about competition.

She said: “The European economy depends on well-functioning financial markets.

“That is not just important for banks and other financial institutions. The whole economy benefits when businesses can raise money on competitive financial markets.

“The merger between Deutsche Borse and the London Stock Exchange would have significantly reduced competition by creating a de facto monopoly in the crucial area of clearing of fixed income instruments.

“As the parties failed to offer the remedies required to address our competition concerns, the commission has decided to prohibit the merger.”

In a statement, LSE confirmed that the agreement between the companies had been terminated as a result of the EC’s opposition.

It added: “LSEG is confident in its prospects as a standalone business and its strategy for growth continues to deliver strong results, as seen in the group’s recent preliminary results for 2016.

“As part of the merger, LSEG had previously announced that it would pay a special dividend to LSEG shareholders, contingent on completion of the merger with Deutsche Börse. Although this special dividend is now not required, LSEG intends to honour the capital return commitment, consistent with its capital allocation framework and reflecting its leverage at the low end of its targeted range.

“Accordingly, LSEG now plans to initiate an on-market share buyback of £200 million, an amount broadly equivalent to the return it would have made had the merger with Deutsche Börse proceeded as planned.

“LSEG continues to be actively engaged in exploring selective inorganic and ongoing organic investment in order to drive further growth and will continue to consider opportunities for further capital returns in line with its capital allocation framework.”</s>" The European Union has blocked the planned merger of Germany's Deutsche Boerse and the London Stock Exchange. EU antitrust chief Margrethe Vestager said Wednesday that the deal would have created "a de facto monopoly in the crucial area of fixed income instruments," such as bonds.

Start the conversation, or Read more at The New Zealand Herald.</s>The European Commission has blocked the (£24.6bn) merger of the London Stock Exchange (LSE) and Deutsche Börse on competition grounds hours before the UK serves its European divorce papers.

EU competition commissioner Margrethe Vestager scotched the third attempt in 17 years to merge the Anglo and German stock exchanges after they refused to meet her requests to sell off the LSE's Italian bond trading platform called MTS.

Vestager said: "The merger would have led to a de facto monopoly in clearing of fixed income instruments.

"As the parties failed to offer the remedies required to address our competition concerns, the Commission has decided to prohibit the merger."

The moves brings to a halt 15 months of plans to combine exchanges in Germany, the UK and Italy, as well as several of the large clearing houses to create the biggest European exchange operator.

The LSE and Deutsche Börse signalled last month that they were not prepared to sell MTS, making the failure of the merger likely.

British Prime Minister Theresa May is set to trigger Article 50 today (29 March), signalling the end of more than 40 years inside the EU, and kicking off two years of withdrawal negotiations.

The LSE had been prepared to sell its smaller French clearing arm LCH to its smaller French rival Euronext for €510m.

However, the European Commission ruled that this remedy did not go far enough.

Vestager added: "The European economy depends on well-functioning financial markets.

"That is not just important for banks and other financial institutions. The whole economy benefits when businesses can raise money on competitive financial markets."</s>The European Union has blocked the planned merger of Germany's Deutsche Boerse and the London Stock Exchange.

EU antitrust chief Margrethe Vestager said Wednesday that the deal would have created "a de facto monopoly in the crucial area of fixed income instruments," such as bonds.

The London exchange said last month that it couldn't commit to selling its majority stake in the electronic bond market MTS, which would have alleviated the EU's concerns.

The companies announced the deal in March 2016, three months before British voters decided in a referendum to leave the European Union. Both insisted that the deal made sense even in case of Brexit.

Shareholders in Deutsche Boerse, which operates the Frankfurt stock exchange, would have owned 54.4 percent of the holding company.</s>A merger that would have created a huge new stock exchange business in Europe has been killed off.

The European Union's competition watchdog said Wednesday it was blocking the deal between the London Stock Exchange (LDNXF) and Deutsche Boerse (DBOEF).

The European Commission said the deal "would have created a de facto monopoly" in an important part of the financial markets related to bonds and debt.

The London Stock Exchange and Deutsche Boerse both said they regretted the decision.

"A rare opportunity to ... strengthen the global competitiveness of Europe's financial markets has been missed," said Joachim Faber, chairman of the supervisory board at the German firm.

The two exchanges have made multiple attempts in the past to combine their operations.

Deutsche Boerse had also planned a tie-up with the NYSE Euronext in 2012, but that too was blocked by the European Commission.

The latest deal, which was announced in February 2016, was billed as a "merger of equals." It was expected to build a powerful link between Europe's premier financial centers. London is a global center for banking and insurance, while Frankfurt hosts the European Central Bank and the finance hub for the German economy.

The European Commission's top anti-trust official Margrethe Vestager said the companies didn't offer enough concessions to guarantee there would be sufficient competition in the market after a merger.

The London exchange had refused the Commission's request to sell its MTS bond-trading platform, arguing that the divestment would cause various problems, including damaging its business in Italy.

Shares in the London Stock Exchange jumped by about 3% after the announcement. Shares in Deutsche Boerse were also edging up by about 0.5%.

The announcement comes on the same day that the U.K. has begun the two-year process of extracting itself from the European Union, a bloc of 28 nations with free trade and virtually open borders. The U.K. voted in June 2016 for Brexit.

Vestager said Brexit was not a factor in her decision to block the deal.</s>The European Commission moved to block the deal after it said the two exchanges had failed to address its competition concerns. The move comes after the LSE rejected the commission's request last month to offload its 60% stake in the Italian trading platform MTS. Margrethe Vestager, the EU's competition commissioner, said: "The European economy depends on well-functioning financial markets.

"That is not just important for banks and other financial institutions. The whole economy benefits when businesses can raise money on competitive financial markets. "The merger between Deutsche Borse and the London Stock Exchange would have significantly reduced competition by creating a de facto monopoly in the crucial area of clearing of fixed income instruments. "As the parties failed to offer the remedies required to address our competition concerns, the Commission has decided to prohibit the merger."

The tie-up has faced multiple hurdles since it was first mooted in February last year, with Britain's Brexit vote flagged by analysts as a potential barrier that could scupper the deal. The LSE had agreed to offload its French clearing business LCH to Euronext for €510 million (£434 million) to help smooth the passage of the merger. However, further doubts were raised last month when it was revealed that Deutsche Borse boss Carsten Kengeter was under investigation by German authorities over alleged insider dealing.

It marks the third failed attempt in 17 years to create an Anglo-German exchange and came just hours before Britain triggers negotiations over its exit from the European Union. In a statement, the London Stock Exchange Group said it regretted the EU Commission's decision not to wave the deal through. "LSEG believes the proposed merger with Deutsche Borse in combination with the LCH SA remedy would have preserved credible and robust competition in all markets. "This was an opportunity to create a world-leading market infrastructure group anchored in Europe, which would have supported Europe's 23 million SMEs and the development of a deeper Capital Markets Union."</s>The EU has blocked the proposed merger of Deutsche Boerse and the London Stock Exchange on the same day that the UK officially triggered Article 50.

Margrethe Vestager, EU competition regulator head, has called time on the tie-up between the Frankfurt and London bourses after they refused to meet competition requests.

She said in a tweet: 'As London Stock Exchange and Deutsche Boerse failed to offer remedies to solve competition concerns, the merger of the two has been prohibited.'

The deal would have harmed competition because of the companies' combined market power, EU antitrust regulators added.

The European Commission said the merger to create Europe's biggest exchange would have created a de facto monopoly in the market for clearing fixed income instruments.

The deal has been plagued by problems since it was first announced fifteen months ago.

The LSE committed to selling its French clearing house to rival Euronext for €510million to help calm those competition fears.

But last month the LSE set the stage for a veto after rejecting a regulatory demand to sell its MTS Italian trading platform.

The LSE acknowledged its decision, in late February, meant it was unlikely Brussels would pass the deal.

Further doubts were raised last month when it was revealed that Deutsche Borse boss Carsten Kengeter was under investigation by German authorities over alleged insider dealing.

Britain's Brexit vote back in June was also flagged as a potential barrier that could scupper the deal.

Neil Wilson, analyst at ETX Capital, said: 'Timing is everything. Today the EU officially blocked the London Stock Exchange merger with Deutsche Borse.'

'Brexit effectively killed this deal off nine months ago so it’s fitting that EU competition commissioner Margrethe Vestager delivered the coup de grace just a couple of hours before the UK triggers Article 50.'

'It brings to an end a fairly dubious history of proposed mergers for LSE at the same time. Its future looks to be, like Britain’s, outside of Europe.'

It marks the third failed attempt in 17 years to create an Anglo-German exchange and came just hours before Britain triggers negotiations over its exit from the European Union.

In a statement, the London Stock Exchange Group said it regretted the EU Commission's decision not to wave the deal through.

It stated: 'LSEG believes the proposed merger with Deutsche Borse in combination with the LCH SA remedy would have preserved credible and robust competition in all markets.'

'This was an opportunity to create a world-leading market infrastructure group anchored in Europe, which would have supported Europe's 23 million SMEs and the development of a deeper Capital Markets Union.'

Vestager added: 'The European economy depends on well-functioning financial markets.'

'That is not just important for banks and other financial institutions. The whole economy benefits when businesses can raise money on competitive financial markets.'

'The merger between Deutsche Borse and the London Stock Exchange would have significantly reduced competition by creating a de facto monopoly in the crucial area of clearing of fixed income instruments.'

'As the parties failed to offer the remedies required to address our competition concerns, the Commission has decided to prohibit the merger.'

Shares in the London Stock Exchange Group are up 2.5 per cent at 3100 pence.</s>BERLIN (AP) — The European Union blocked the proposed merger of Germany’s Deutsche Boerse and the London Stock Exchange on Wednesday, saying that it had “very serious” concerns about the deal’s impact on competition.

The deal would have created “a de facto monopoly in the crucial area of fixed income instruments,” such as bonds and repurchase agreements, EU antitrust chief Margrethe Vestager said.

The decision was expected after the London exchange said last month that it couldn’t commit to selling its majority stake in the electronic bond market MTS, which would have alleviated the EU’s concerns.

The deal would have combined Deutsche Boerse’s Frankfurt-based clearing house, Eurex, with LSE’s LCH.Clearnet and the Rome-based Cassa di Compensazione e Garanzia.

The companies announced the deal in March 2016, three months before British voters decided in a referendum to leave the European Union. Based on their stock market value at the time, the two companies together were worth about $30 billion.

Both companies had insisted that the deal made sense even in case of Brexit.

Brexit wasn’t cited as a factor in Wednesday’s decision, but the vote also complicated the deal’s prospects as it called for the companies to be united under a U.K.-based holding company — an idea questioned by some in Germany in light of Britain’s EU departure

Shareholders in Deutsche Boerse, which operates the Frankfurt stock exchange, would have owned 54.4 percent of the holding company.</s>European regulators blocked the proposed merger of Germany's Deutsche Boerse and the London Stock Exchange on Wednesday, saying it would effectively have created a European monopoly in clearing bonds.

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The European Commission blocks the third attempt of the London Stock Exchange and Deutsche Börse at a merger, citing the danger of a "de facto monopoly in the crucial area of fixed income instruments".