The Hong Kong’s stock exchange on Wednesday made an unsolicited $39 billion (€35.43 billion) bid to take over the London Stock Exchange (LSE).

The surprise move comes amid large pro-democracy protests in Hong Kong and Brexit turmoil in London, with both cities attempting to create a global trading power to compete with US rivals such as ICE and CME.

“The board of HKEX [the parent company of Hong Kong’s stock exchange] believes a proposed combination with LSEG represents a highly compelling strategic opportunity to create a global market infrastructure leader,” the Hong Kong exchange said in a statement.

“HKEX is fully committed to supporting and building the long-term roles of both London and Hong Kong as global financial centers,” it added.

The LSE has long sought to improve its presence in Asia and recently launched a link scheme with HKEX competitor Shanghai.

The Hong Kong offer, however, is contingent on the LSE not merging with the UK-based data company Refinitiv.

The LSE said it would review the proposal but that it was making good progress on its planned acquisition of Refinitiv from a consortium led by US private equity firm Blackstone.

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Benificial for both exchanges?

The takeover bid comes as Britain is set to leave the European Union, a step many analysts say could weaken its position as a major financial center in the world. Potential barriers could make it harder for Britain to trade in the rest of Europe.

But the Hong Kong stock exchange said the merger would strengthen both exchanges’ strategic positions as offshore hubs for trading in Eurodollars and renminbi, while also offering the UK a bigger presence into mainland China.

The merger would “create a world-leading global exchange that spans Asia, Europe and the United States with a market value of more than 70 billion dollars,” according to a blog post by Charles Li, the chief executive of HKEX.

The offer from Hong Kong follows a bid to merge the London stock exchange and the Deutsche Boerse, which was blocked by the European Commission in 2017 after two other failed attempts.

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