Regulator clears LSEG merger with fintech Quantile

CMA LSEG Quantile

The Competition and Markets Authority (CMA) has cleared the merger between the London Stock Exchange Group (LSEG) and Quantile following an in-depth investigation.

The CMA temporarily blocked the merger, worth around £274m, in May over concerns that the deal could be harmful to market competition.

Founded in 2015, Quantile is a fintech firm that aims to reduce regulatory costs and capital requirements for financial institutions that trade in derivative instruments through a process called multilateral compression.

The CMA’s concerns were that LSEG similarly provides cost-reduction services for financial institutions and investigated whether a merger would create an uncompetitive market.

The phase one investigation found there was some legitimacy to these concerns, prompting an in-depth phase two investigation. This saw the CMA engage with customers of the companies and third-party providers of similar services, ultimately deeming the market would not be hurt by the deal.

“The in-depth investigation and consultation allowed us to engage extensively with LSEG, Quantile, and their customers and competitors, enabling us to better understand the impact of the transaction on those businesses and the market,” said Martin Coleman, chair of the CMA independent inquiry group.

“On the basis of that engagement, and other evidence we have gathered, we are satisfied that this deal will not worsen the options available to businesses and consumers. As such, the transaction can go ahead.”