LME WEEK: Continuity Key In LME Acquisition Process -Board Members

Continuity of operational practices is an important consideration for members of the London Metal Exchange board as the bidding process continues for a potential acquisition of the exchange, two members of the LME board said Monday.

Gavin Prentice of Marex Financial Ltd. and Fabian Somerville-Cotton of HSBC Bank PLC told the LME's annual Metals Seminar here that respect for the LME's operational traditions and practices will be a question for the board to consider as they review bids.

"Yes, the ring will be a question," said Prentice, who is managing director and global head of sales at Marex, referring to the LME's open-outcry trading floor.

"The ring continues to flourish and people continue to use it," Prentice said. "It is an important part of the price discovery mechanism."

"Continuity is very important to running a successful business," said Somerville-Cotton, a managing director at HSBC and head of the LME's warehousing committee. "The LME is doing fantastically well and we are by no means sure that any deal will be done."

At least 10 interested parties have approached the LME about a potential buyout.

The exchange hasn't named any of the interested parties, but metals rivals CME Group Inc. (CME), Shanghai Futures Exchange and Singapore Exchange--as well as the Dubai Mercantile Exchange, the London Stock Exchange Group PLC (LSE.LN) and IntercontinentalExchange Inc. (ICE)--have all been named by market participants as likely to be interested.

The LME accounts for at least 80% of globally traded base metals such as copper and aluminum.

-By Francesca Freeman, Dow Jones Newswires; +44 (0)20 7842 9412; francesca.freeman@dowjones.com

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