NASDAQ + SOX << LSE
NASDAQ wants to buy the London Stock Exchange to follow the money that's fled the US Sarbanes-Oxley plague. But if their hostile bid prevails, they'll just spread the contagion, so the Brit government needs to protect the LSE.
Here's the WSJ ($):
Another place merger money is going is overseas. This may help explain Nasdaq's $5 billion hostile bid for the London Stock Exchange, which was rebuffed yesterday. As more and more international companies list their shares overseas rather than in New York, having a foothold outside the U.S. has come to be seen as a survival strategy for the formerly comfortable U.S. stock exchanges. They have to follow the money if the money won't come here.There's nothing wrong with Nasdaq - I once participated in a listing there, and it went swimmingly. The problem is the SEC:
America's Securities and Exchange Commission is the federal regulatory agency and can be over-zealous, prescriptive and intrusive – all things that the City of London can do without.I wouldn't trust assurances from the SEC - it'll be led by a Dem appointee eventually, and we all know what they think about foreign competition - here's Rep. Frank, hat tip OpinionJournal (my emphasis):
Yet the SEC will not think twice about extending its regulatory activities to the City of London should Nasdaq take over the London Stock Exchange, arguing that the New York-based exchange is part of its bailiwick wherever it may set up shop.
Representative Barney Frank has proposed in a series of meetings with business groups a "grand bargain" with corporate America: Democrats would agree to reduce regulations and support free-trade deals in exchange for businesses agreeing to greater wage increases and job benefits for workers...The Brit government must plant a poison pill in the LSE. ASAP.
Frank casts his proposal as a way for capitalists to quell some of the populist fervor that was expressed in last week's election, when many Democrats vowed to crack down on companies moving jobs overseas.