LME says buyers lining up as it clears first gold trade
Businessweek reports on the day it cleared and matched its first gold trade the London Metal Exchange which handles some 80% of global trade in metals futures, told members on Tuesday that it has receive “many” expressions of interest from potential bidders.
The 134-year-old exchange is facing increased competition from other exchanges in Asia and is plagued by a backlog of industrial metals particularly aluminum that’s building at warehouses. LME-monitored warehouses contain 6.7 million metric tons of metal and at some warehouses such as Detroit it can take as long as seven months to withdraw metal. The LME is looking to start trading silver next year.
Despite talk of an $1.2 billion offer as far back as 2008, it is unclear how receptive the trading houses and banks like Barclays and Goldman Sachs that own the market would be to selling out with CEO Martin Abbott saying on Tuesday shareholders would need “a compelling reason” to sell according to Businessweek.