Both suitors vying for the 135-year-old metals trading exchange have spent the past few days speaking to LME shareholders and including feedback into their bids. Sources close to the process said no significant changes to the way the LME is currently run are being proposed.
The Chinese government chooses the chairman and chief executive of the Hong Kong Exchanges and Clearing, as its largest shareholder. Fears have been raised that placing the entity that sets prices for industrial metals globally in the hands of the biggest consumer of industrial metals globally may not be a sensible move for the rest of the world.
Assume that the Chinese do buy it then they manipulate the prices.
So, sellers will avoid the exchange and trade elsewhere (which they can indeed easily do). And the value of the Chinese stake goes down as the market bleeds trade.
Note that it is the exchange that is being sold: not the warehouses, not the actual metals themselves, just the exchange. Being \”concerned\” over this is a bit like worrying about what will happen to BP if the London Stock Exchange is owned by foreigners. You know, nothing…..