250 jobs would go in LSE, Liffe deal

MERGING the London Stock Exchange and Liffe would generate annual savings of more than £25m, partly through cutting about 250 jobs, the LSE was expected to tell the board of the futures exchange today.

Its pitch was to include plans either to adapt Liffe's existing futures trading platform to accommodate equities or build a totally new system providing for both. The move is seen costing about £80m, the same amount the LSE spent building its Sets settlement platform, but could be higher if a system is built from scratch.

It is believed the LSE will table an indicative offer valuing Liffe at about £550m, or just over £17 a share, split almost equally between cash and paper. Euronext, the Continental exchange, was also making a presentation to Liffe today. It was expected to make an all-cash bid at about the same price.

The LSE will propose that its chief executive Clara Furse holds the same position in the merged group. It will also suggest its chairman Don Cruickshank retain his post, though Liffe chairman Sir Brian Williamson is widely expected to challenge this. Liffe chief executive Hugh Freedberg would be one of two deputy chiefs under the LSE plan.