Global financial data provider Refinitiv said on Tuesday that its proposed $27 billion merger with the London Stock Exchange will create more opportunities for foreign investors to access the huge market in China, a top company official said.
"We are certain that Asia and China will be the major growth areas for the company after the acquisition," said Nicole Chen, managing director of Refinitiv in China.
Refinitiv and the LSE are committed to completing the deal by the end of the year as scheduled and it would be the first between a well-known stock exchange and a data provider, Chen told China Daily in an interview.
Refinitiv plans to be the world's largest financial infrastructure provider in terms of revenue after the LSE deal and will look to enrich its China-related product portfolio after the deal as both parties see the Chinese market as "strategically important", she said.
With China's financial market becoming far more open in recent years, overseas investors' demand for market data from the country has also surged, creating a major business opportunity for Refinitiv, Chen said, adding that overseas users are the biggest users of its China Market Analysis application.
The company's optimism on the Chinese market stems from the stock connect between the London and Shanghai bourses that was established last year. The Shanghai-London Stock Connect enables companies to float shares on both exchanges simultaneously via a depository receipt mechanism, a milestone in China's accelerated financial opening-up.
Refinitiv invested a lot to enrich its databases for the Chinese market as it expects the robust demand to continue. It added 350,000 pieces of data last year to its Datastream product to provide macroeconomic data from China to the county level, said Chen.
"Having access to specially designed, comprehensive databases and analytics that are specific to the Chinese market is crucial for the survival of foreign institutions. Refinitiv is well positioned in providing such data given its rich reserve of China market data and experience in serving global clients," Chen said.
Formerly the financial and risk business of Thomson Reuters, the company serves more than 40,000 institutions in approximately 190 countries and is usually seen as a rival to Bloomberg.
Refinitiv will continue to diversify the usage scenarios of Chinese market data and develop related databases or applications, catering to the rapidly changing data demand, Chen said.
Chen said there are new growth points for Refinitiv China in areas like wealth management and asset management, given the growing group of high net worth individuals in the country, on top of traditional service lines like foreign exchange and fixed income.
Chen said investors in China are paying "systemically higher "attention to investments based on environmental, social, and governance factors, especially since the COVID-19 outbreak.
The commitment of Refinitiv to the Chinese market reflects the country's attractiveness for foreign investment as an economy that has staged a steady economic recovery from the COVID-19 epidemic and has furthered opening-up efforts despite the epidemic, said Liu Chunsheng, an associate professor of international trade at the Central University of Finance and Economics in Beijing.
