Reuters, a prominent news outlet, issued out a report on Wednesday. This report showed that the European Union (EU) is taking steps to give clearance for the London Stock Exchange (LSE) to go through with its $27 billion acquisition deal for Refinitiv.

Inside Sources Claim Deal Is A Go

This news was revealed ahead of the specified deadline for the European Commission (EC)’s decision over the acquisition deal, which was set on the 15th of January, 2020. Reuters cites two individuals “familiar” with the matter at large as its source.

The acquisition deal itself was agreed upon by both Refinitiv and the LSE back in August of 2019. The UK and US financial market regulators had given their respective green lights for the deal already, but the EC wasn’t so quick. The European regulator had raised concerns regarding antitrust, promptly initiating a probe to ensure the agreement will be healthy for the EU markets.

LSE Set To Challenge Bloomberg

There are grounds for concern for the EC, however. Should this deal pull through, this newly merged entity will stand as one of the largest financial data providers out there. The only entity that will be above it is Bloomberg LP, the leader in the space.

The LSE had sold its entire stake within the leading Italian stock exchange earlier this year, allowing Euronext, its European rival, to take it up. Alongside this, LSE had allowed its competitors to use its data services for the next decade, which are all part of the concessions the exchange had made in order to get clearance for the Refinitiv deal.

It should be noted, however, that there is no definitive correlation between these concessions and what ultimately led to the EC’s decision regarding the approval of the deal. Either way, clearance at this early stage for the LSE to close the deal will mean a lot for its parent company. Simply put, the acquisition target deadline for this deal, in particular, had been set at the end of Q1 2021.

A New Financial Data Arena

Financial data services had seen its demand skyrocket throughout these past years. As a result, countless companies have crawled out of the woodwork to try and fill this niche, but Bloomberg had always maintained its market supremacy on this front.

In other fields, S&P Global is making moves, as well, planning to purchase IHS Markit Ltd for a hefty $44 billion. Both IHS and S&P are leading data service providers. As such, a merger between these two would create yet another giant, albeit a smaller giant than the LSE-Refinitiv merger, which is itself smaller than Bloomberg.

It’s all just a game of big fish eating each other to be the biggest fish out there. As it stands now, Bloomberg’s the orca, and LSE is planning to become a great white. It will be interesting to see how these groups compete.