German 'threat' to stock market merger

Opposition to iX may not be limited to London

German financiers may yet scupper plans to launch a joint Anglo-German stock exchange, a poll has revealed.

The merger plan has already split London's City.

Frankfurt stock markets heads have yet to secure the 75% backing needed to secure German approval for the merger, a newspaper claimed on Friday.

The poll, by the German business paper Boersen-Zeitung, found outspoken support for the merger among only 28.4% of Deutsche Boerse's shareholders.

The deal, which would create a single pan-European exchange named iX, has already attracted criticism from UK brokers concerned about the details of the scheme.

Exchange confident

Deutsche Boerse, which has been consulting financial institutions in Germany about the merger, declined to comment on the poll.

Deutsche Boerse shareholders

International and German banks: 80%

Brokers: 10%

Regional stock exchanges: 10%

(Approximate figures)

"We cannot comment on this kind of speculation," a spokesman for the exchange told BBC News Online.

But a Deutsche Boerse insider said the exchange was confident of winning approval for the deal at a shareholders meeting on 14 September, the same day as LSE shareholders vote on the plan.

"From our findings we have support of more than 80%," the insider told BBC News Online.

Advisory committee

The poll results follow the launch on Thursday of an advisory group of bankers and brokers, which will act as a central consultation point for both Frankfurt and London exchanges.

The 13-strong committee, a permanent body, includes representatives of international banks, private client brokers and institutional investors, and is chaired by Hector Sants, chairman of US-owned DLJ Securities.

Mr Sants, who said the benefits of the merger are "clear", is also a member of the LSE board.

Also on Thursday, a lobby group of 14 City brokers concerned about the deal presented the LSE with a list of 28 points it wants clarified before the September vote.

Concerns over small firms

iX would be the world's third-biggest exchange, and the group is seeking information on what its creation would mean for smaller companies and the brokers dealing in their shares.

"Until we get this information we won't know how to vote," said group member Brian Winterflood, chairman of Winterflood securities, the largest UK market maker for small company listings.

Other members of the group include Brewin Dolphin, Barclays and HSBC.

The LSE consultation group includes representatives of ABN AMRO, Desdner Kleinwort Benson, NatWest Stockbrokers and Merrill Lynch.