Deutsche rebels aim to unseat Rambo

DEFIANT Werner Seifert won't be backing down in his £1.35bn battle for control of the London Stock Exchange even after a bruising few days for the Deutsche Borse chief executive.

Rebels have stepped up their efforts to unseat the man dubbed Rambo because of his forceful business style. So incensed are they with his takeover plans they want him replaced with Reto Francioni, his one-time deputy and head of the Swiss exchange.

Even more sensationally, they are ready to install Lord Jacob Rothschild as chairman. The veteran banker is father of Nat Rothschild, who heads Atticus Capital, one of the dissidents.

US hedge fund Atticus and fellow rebel TCI are seething over Seifert's acquisition plan. Between them they speak for 13% of the German company and want him to return £346m of surplus cash to shareholders.

Under German law, institutions won't get to vote on the deal and that has led US fund giants Fidelity and Merrill Lynch Investment Management to withdraw their support for it.

But Deutsche Borse still reckons it has the backing of the bulk of investors and will continue courting the LSE. 'We recognise there is a wide range of views among our shareholders and we continue to have a dialogue with them,' a spokesman said. 'But we are confident we have the best strategy for building value.'

Deutsche Borse's receding takeover hopes open the way for Euronext, the merged Paris, Amsterdam and Brussels stock markets. Executives there think they can eke out considerably more cost savings from any takeover than the Germans. They are currently sounding out their US and UK investors.

The LSE has twice rejected a 530p-a-share indicative offer from Deutsche Borse. Seifert is waiting for the Office of Fair Trading to complete a competition review before upping the ante to closer to £6 a share.