Press releases 2000

17 May 2000

iX-international exchanges and the Euro

In evidence to the Treasury Select Committee today, Don Cruickshank, Chairman-designate of iX-international exchanges - to be created by the prospective merger of the London Stock Exchange and Deutsche Brse - confirmed its policy with regard to the quotation of shares in euro and sterling.

Commenting after the Committee hearing, he said: "The proposed merger between London and Frankfurt is an important development for European capital markets and we were pleased to have the opportunity to restate our position at this morning's meeting of the Treasury Committee. As a commercial company, we will be ever intent on serving the interests of our customers, the companies themselves and those who trade in their shares."

Mr Cruickshank confirmed that:

• Changes in the market structure such as the development of the market for Europe's top companies, and the evolution of the pan-European growth market with Nasdaq, will be subject to consultation with market participants, as with all aspects of integration policy. Changes are therefore likely to start to take effect from the spring of 2001.
• iX-international exchanges will operate a single technology platform which will support multiple currencies and in particular will support both Sterling and the Euro.
• It is entirely a matter for a company, in conjunction with its shareholders, to determine the currency in which it raises capital, states its accounts or pays dividends.
• the currency in which the shares of a company is traded is a separate issue - the new exchange will need to offer trading in a company's shares in the currency which best meets the needs of investors and other users of the market.
• In the event that the primary currency of trading was not sterling for a UK company, the Exchange would ensure that sterling prices were still available for private investors, newspapers, indices etc.
• The single platform will support multiple markets as well as multiple currencies.
• Companies currently listed on Europe's national markets will be admitted to trading on the new iX markets.
• Existing companies will not be required to give up their home market listing to be admitted to trading to the new iX markets. New companies will be listed and admitted to trading by iX-international exchanges through the regulatory structures it operates in London and Frankfurt.
• Domestic markets in the UK, Germany and other member states will continue to serve companies which do not qualify or do not wish to be traded on the new pan-European markets.
• Part of the benefit of integration under the iX-international exchanges brand will be moves to influence the creation, over time, of standard rules of conduct, supervision and transparency across the markets.

Mr Cruickshank added: "It is especially important to note that iX-international exchanges will not, and cannot, force companies to report in any particular currency, far less oblige shareholders to take currency risks. The proposed merger will provide a greater range of investment opportunities and deeper liquidity for private investors in the UK, who will, of course, continue to be able to trade in sterling.

"Further details on these and all other issues of interest to our shareholders and customers will be set out in a full information document. In the meantime, I have a full programme of meetings with shareholders and customers. I want to listen and make sure that any issues raised are resolved or, at the very least, addressed in full in the information document."