LSE Pushes Ahead With London-Shanghai Link Plan Before Year-End

(Bloomberg) -- London Stock Exchange Group Plc says the long-anticipated bridge between stock exchanges in London and Shanghai is on track to begin operation before the end of 2018.

“The stated intention by the British and Chinese governments is to have it up and running by the end of this year,” Charlie Walker, head of equity primary markets at LSE, said in a London interview. “We’ve already started to see significant interest both from U.K. companies looking to go to China and Chinese companies exploring coming to the U.K.”

The link, Shanghai-London Stock Connect, will for the first time allow international investors to access mainland-traded China A-Shares via depository receipts traded in the U.K. It will also allow London-traded firms to list CDRs in Shanghai and, unlike the Hong Kong Connect, permit international businesses to list directly on an exchange in mainland China.

Huatai Securities Co., China’s third-largest brokerage by market value, and Bluestar Adisseo Co. are among Chinese companies considering U.K. listings, people familiar with the matter told Bloomberg News on Tuesday.

Chinese bourses have been forging closer relationships with offshore counterparts in recent years, a financial adjunct to Beijing’s infrastructure program to tie economies across Asia and Europe more closely to China.

The Shenzhen-Hong Kong Connect opened in December 2016, two years after the start of the cross-border link with Shanghai. The move made more than 1,400 mainland stocks available for offshore investors to trade via Hong Kong.

An agreement for some sort of exchange connection between London and Shanghai has been in the works since at least September 2015, when plans were disclosed during a visit to China by then-U.K. Chancellor of the Exchequer George Osborne.

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