LSE, Deutsche Börse see 1,250 jobs cuts after merger

Up to 1,250 jobs will be axed in the £20bn merger between the London Stock Exchange and Deutsche Börse, according to the merger prospectus published on Wednesday.

The document outlines plans for pre-tax cost savings of about €450m a year in the third year after completion of the deal.

It says the cost synergies are split between technology-enabled efficiencies (approximately 50%), corporate centre (30%) and "business segment optimisation" (20%).

“The LSEG board and the Deutsche Börse management board expect that the impact of cost synergy realisation would be distributed in a balanced manner across LSEG and the Deutsche Börse,” the two companies told shareholders.

“However, according to current integration assessments, the boards believe that in order to achieve the aforementioned cost synergies in the third year after completion there could be an overall potential job reduction of approximately 1,250 existing roles across the combined group.”

“The detailed plans for any restructuring are not yet known and finalisation of any such plans would be subject to detailed and comprehensive planning and appropriate engagement with stakeholders, including employee representative bodies. Until such plans are finalised, the boards cannot be certain what impact there will be on the employment of the management and employees of the combined group.”

The deal is forecast to produce extra revenues of €160m in the third year after completion, rising to €250m a year in the fifth year. The two firms have made a one-off provision of €100m to cover costs of hitting these targets.