Now tell me this isn't a politically-motivated merger...

Hong Kong Exchanges' $2.2 billion bid for the LME this month valued the world's largest trading venue for industrial metals at 181 times earnings, making it the most expensive bourse acquisition exceeding $1 billion on record, according to data compiled by Bloomberg. With the Asian company's stock tumbling since the first report of its interest in the LME, it has now retreated 33 percent in the past year, the biggest decline among the world's 20 largest exchanges, the data show.

While the merger will give Hong Kong Exchanges control of about 80 percent of global trade in industrial-metal futures as it grapples with falling profits and a slump in initial public offerings, the New York Stock Exchange (NYX)'s head said the price would have been too rich for the biggest U.S. bourse operator. An increase in trading by Chinese companies on the LME is vital to justify the deal, making the takeover's success dependent on China's regulators, who have so far resisted granting the LME access to the mainland to protect its rival in Shanghai, according to Core Pacific-Yamaichi International (H.K.) Ltd.

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