London Stock Exchange - raising capital in the heart of world’s financial markets

Tracey PierceDirector of Primary Markets

June 2011

2

London is the key global listing venue

London Stock

ExchangeHKSE

NYSE Euronext

(US)

NYSE Euronext (Europe)

DBAG

Total Market cap(1)

(of which international)

USD 6,826bn(USD 3,509bn)

USD 2,724bn(USD 154bn)

USD 14,024bn(USD

1,689bn)US 3,091bn

USD 1,519(USD 106bn)

Number of listed companies(of which international)(1)

2,949(601)

1,420(16)

2,316(523)

1,133(152)

755(74)

Flagship Index FTSE 100Hang Seng

IndexDow Jones Industrial

Euronext 100 DAX

International companies in the index

Yes No No No No

Annual share turnover(1)

USD 246tr USD 111tr USD 1,336tr USD 182tr USD 132tr

% of share trading in int’l companies listed*

14% 0.52% 11% 0.38% 4.32%

Price / earnings ratio(2) 13.46x 12.76x 13.99x 12.84x 12.39x

All information is as at 1 March 2011(1) Source: World Federation of Exchanges,

Individual websites, FactSet, Bloomberg and LSE(2) six month average; source: Bloomberg

3

We operate the largest and most liquid equities market in Europe

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

LSEG NYSE Euronext(Europe)

Deutsche Borse NASDAQ OMXNordic

0.00

100.00

200.00

300.00

400.00

500.00

600.00

700.00

800.00

900.00

1,000.00

Transaction ValueTransactions

Domestic market capitalisation of European exchanges as at 1 March 2011

Average daily traded value (ADTV) and number of trades in shares in 2010

(1)By number and mkt capitalisation of listed companies (2)by value of transacted shares Source: World Federation of Exchanges

• Close to 3,000 companies sharing an aggregate market cap of close to USD 7 trillion

• 600 international companies with aggregate market cap exceeding USD 3.5 trillion.

• Over 600 member firms operate on our platforms

• During 2010, an average of over USD 12bn worth of shares were traded daily on the LSEG’s markets, more than any other exchange in Europe.

LSE is the largest IPO market in Europe(1)

LSEG is the most liquid secondary market in Europe(2)

4

Our global footprint

Source: London Stock Exchange statistics. Based on country of operation

We have companies from more than 110 different countries

60 +

40-59

20-39

1-19

Number of companies as

at 1 March 2011

5

*by number of international companies listed (1)as at Feb 2011. Based on country of incorporation of the issuer, except HKSE and LSEG where country of primary business is applied. Euronext

Brussels is not included. Source: FactSet, Bloomerg and LSE calculation

Comparison of market capitalisation of international companies (1)

London Stock Exchange is the most international exchange*

LSE is a global leader in listing international companies.

•This enables listed issuer to compare themselves against their peers.

•It also creates dedicated investor community

6

Source: relevant exchange websites and Bloomberg. DB figures do not include Open Market

London Stock Exchange leads the way in international listings

NORTH AMERICA

EMEARUSSIA AND

CIS

SOUTH AMERICA

ASIA

Total number of international companies admitted to trading as at 1 March 2011

INDIA

7

London Stock Exchange is a global leader in IPOs

0

100

200

300

400

500

600

700

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

LSE NYSE Euronext (US) Hong Kong Deutsche Borse NYSE Euronext (Europe) Shanghai

Source: World Federation of Exchanges

Financial crisis

Number of IPOs Post crisis LSE continues to lead in

IPOs

8

LSEG is the leader in attracting companies from a wide range of sectors

Comparison of market capitalisation of international companies issuers, by sector*

* as at Feb 2011. Based on country of incorporation of the issuer, except HKSE and LSEG where country of primary business is applied. Euronext Brussels is not included. Source: Factset, Bloomerg and LSE calculation

LSE maintains the global benchmark peer group in

•Oil and Gas

•Mining

•Retail

•Health care

•Telecommunications

It is also leading the way in almost all other sectors.

9

London is a global hub for international investors

USD million

Assets managed in the UK and globally from London – ten largest investment firms

Source: Investment Management Association: Asset Management in the UK

2009-2010

All major global investors sit in London and are able to access the London Stock Exchange listed stocks

0 -11 -10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 +1 +2 +3 +4 +5 +6 +7 +8 +9 +10 +11

…sitting in a time zone which can trade with the

world

London trading hours

10

USD(bn)

We provide access to the world’s largest pool of international equity assets*

*Based on international equity AUM in key financial centres. (1)Data for NYSE Euronext |(US) and DBAG currently unavailable Source: Ipreo, March 2011

International equity assets under management in key financial centres

Equity assets under management held by foreign investors(1)

London has the largest pool of investors dedicated to international companies and also serves as a hub attracting more foreign investors compared to any other financial centre

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Listing on London Stock Exchange provides for a truly international shareholder register

Severstal United KingdomUnited StatesSwitzerlandGermanySwedenFranceAustriaFinlandDenmarkIrelandEstoniaBelgiumNetherlandsCzech RepublicOther

Investor registers by country (May 2011) Pie charts show market value of each holding

Source: FactSet

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Money raised by CIS companies

• In 2005, LSE established itself as a venue of choice for Russian IPOs

• In 2009, London became a hub for Russian SPO deals providing much needed growth capital for listed companies

• Overall market conditions are improving – average and median money raised by CIS companies in 2011(YTD) are comparable to 2006 &2007 when the market was booming

2004 2005 2006 2007 2008 2009 20102011(YT

D)

No. of CIS IPOs (MM)

1 9 13 19 6 1 4 4

No. of CIS SPOs (MM)

- - - - - 2 3 1

Average raised (mn$)

178.0 657.9 1503.7 1,286.4 285.1 188.5 440.4 1,038.3

Median raised (mn$)

178.0 638.8 748.0 800.0 334.5 101.0 400.0 575.0

Source: www.RussianIpo.com, Bloomberg

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0.13%

0.15%

0.16%

0.18%

0.18%

0.19%

0.20%

0.21%

0.24%

0.29%

0.32%

0.37%

0.57%

BHP BILLITON

BRIT AMER

TOBACC

BG GROUP

HSBC HLDGS

GLAXOSMITHKLINE

VODAFONE

GROUP

BP

ASTRAZENECA

TESCO

RIO TINTO

STANDARD

CHARTER

ANGLO AMER

BARCLAYS

0.30%

0.31%

0.34%

0.49%

0.53%

0.56%

0.57%

0.67%

0.82%

1.05%

1.18%

1.33%

1.33%

SURGUTNEFTEG

MAGNIT

NOVATEK

NOVOLIP

SISTEMA

MAGNITOGORSK

GAZPROM

MMC NORILSK

LUKOIL

ROSNEFT

SEVERSTAL

EVRAZ GROUP

VTB BANK

London Stock Exchange is a leader in trading emerging market securities

Source: Bloomberg, March 2011

Average Daily Value traded (6m) as a percentage of free float market cap - for emerging

market securities trading on IOB

On the London Stock Exchange, issuers from emerging markets enjoy comparable liquidity with the world’s

most liquid securities.

Allocation of a security on IOB or SETS does not affect its liquidity

0.35%

0.37%

0.50%

0.65%

0.73%

0.86%

0.91%

1.30%

ESSAR ENERGY

ANGLO AMER PLC

FRESNILLO PLC

EURASIAN NATURAL

ANTOFAGASTA PLC

KAZAKHMYS PLC

AFRICAN BARRICK GOLD

VEDANTA RESOURCES

Average Daily Value traded (6m) as a percentage of free

float market cap - for emerging market securities trading on

SETS

Average Daily Value traded (6m) as a percentage of free float

market cap - for top FTSE 100 constitutes

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Companies from CIS enjoy high levels of liquidity

Source: www.RussianIPO.com

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Q1 2011 Value Traded Rankings:

1 IOB Gazprom DR2 FTSE Rio Tinto3 FTSE HSBC4 FTSE BHP Billiton5 FTSE Vodafone 6 FTSE BP

7 IOB Lukoil DR8 FTSE Xstrata9 FTSE Anglo American10 FTSE GlaxoSmithKline11 FTSE BG12 FTSE Barclays13 FTSE Standard Chartered14 FTSE RDS B15 FTSE BATS

16 IOB MMCNorilsk DR17 IOB Rosneft DR18 FTSE AstraZeneca19 FTSE Tesco20 FTSE Lloyds… … …

IOB securities are leading LSE’s secondary markets

Source: UBS Investment Bank

• IOB is LSE’s fully dedicated depositary receipt electronic trading platform

• Powered with LSE’s MIT trading technology infrastructure

• Clearing, netting and settlement services which enhances liquidity

• New product development such as FTSE Russia IOB index and individual GDR option contracts, help to drive liquidity

• In 2011(YTD), total value traded on IOB was more than US$180 bn and accounted for around 16% of total order book value traded on LSE

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Average analysts per company, by sector

Source: Bloomberg. Data includes only companies on the main boards of each exchange

Average analysts per company

• Analysts raise profile for the listed companies which they cover

• Analytical reports deepen issuers’ liquidity potential

• London listing provides for the largest analyst exposure compared to any other centre

London Stock Exchange listing gives companies global visibility

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0

50

100

150

200

250

300

350

400

450

500

FTSE 100

MSCI Emerging

LSE Emerging MarketCap

London Stock Exchange traded companies from emerging markets outperform peers listed elsewhere

LSE Emerging index represents the performance of emerging stocks on the London Stock Exchange weighted by market cap. Source: LSE calculation and Bloomberg. All indices rebased as at 1/01/2005.

Return on investment in LSE listed emerging markets companies is higher than compared to on other markets.

It highlights:

• The growth story and quality of LSE issuers

• That issuers listed in London gain additional investors which they would not normally attract in their home market.

Index performance

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London Stock Exchange offers choice of markets

Main MarketEU Regulated markets

Exchange Regulated markets

AIM

Professional

Securities Market

Specialist Fund Market

Securities admitted to official list

(maintained by UKLA)

Securities not admitted to official

list(maintained by UKLA)

The choice of market will depend on a number of factors including:

• Stage in company’s development

• Complexity of the offer and securities issued

• Targeted investors

• Size of the company • Company's strategy and objectives

From small to large

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Glencore chose London for its premium listing and HK for its secondary listing

Glencore relied on London for core of its international offering, resulting in liquidity concentrating in London

Source: Fidessa

Comparison of average weekly tradingturnover for GLENCOREInternational Offer /

listed in London

UK investorsCornerstone investorsEU investorsHong Kong investors Qualifying investors (in accordance with 144A and other exemptions from the US laws)

HK offer / listed in Hong Kong

Public and professional investors in Hong Kong

Source: Glencore IPO prospectus May 2011

US

Dm

Glencore cornerstone investors

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Case Study: Glencore International PLC

Company ProfileGlencore PLC is a leading integrated producer and marketer of commodities, with worldwide activities in the marketing of metals and minerals, energy products and agricultural products and the production, refinement, processing, storage and transport of these products. Headquartered in Switzerland, Glencore operates globally, leveraging on its expertise and relationships with a broad supplier and customer base from diverse industries and geographic regions.

Listing storyGlencore joined the Main Market of the London Stock Exchange in May 2011 and was also admitted to the FTSE 100 – the first company in 25 years to be launched straight into the FTSE 100 at IPO. Following a successful book-building that was 6 times oversubscribed, Glencore raised USD 7bn.

After listingAccording to its prospectus, Glencore intends to apply the proceeds from the global offer towards: acquisitions of additional stakes in strategic partners; capital expenditure in some of its existing projects; reducing the cost of borrowing and improving financial flexibility. The listing is particularly prudent as the current structure enables the company to draw-down on more funds from investors  through either new or existing facilities. 

The biggest IPO in 2011 YTD raising over USD 10bn

Source: publicly available information. Please refer to the end of the presentation for legal disclaimer

Main Market – Premium Equity Commercial Company

Admission Date:Country of

incorporation:Main country of

operation: Money Raised at

Admission: TIDM:IPO advisers:

19 May 2011JerseyGlobal

USD 10 bnGLEN

CITI, Credit Suisse, Morgan Stanley

Index: Website:

FTSE 100http://

www.glencore.com

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pri

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Market Cap at IPO: USD 56.3bnMarket Cap as at 1/06: USD 57.4bn

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Case Study: Exillon Energy PLC

Main Market – Premium listing

Admission Date:Country of

incorporation:Main country of

operation: Money Raised at

Admission: TIDM:IPO advisers:

17 Dec 2009UK

RussiaUS$101mln

EXIING Bank, BAML,

Mirabaud Securities

Index: Website:

FTSE 250www.exillonenergy.com

Company Profile

Exillon Energy is a Russia-focused oil producer with upstream operations located in two oil rich regions of northern Russia, Timan-Pechora and West Siberia. The company has a high quality reserve base and has a proven track record in discovering and producing high quality crude oil.

Listing story

Exillon Energy was the first Russian company to IPOsince the crisis struck in 2008. The vast majority of the IPO was bought by London based investors specialising in Oil & Gas.The company raised just over US$100mln in a purely primary offering. The IPO represented just under a third of Exillon's share capital and valued the group at US$313 million.

After listing

The company used the proceeds to finance new projects and repay debt. After its successful IPO in 2009, the company came back to the market on two occasions raising a further US$34mln in 2010 and US$150mln in 2011.

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Market Cap at IPO: USD 313 mlnMarket Cap Today: USD 1,164 mln

The first London IPO from Russia after the financial crisis struck in 2008

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Case Study: VTB Bank

Company ProfileVTB is a leading Russian bank with strong international presence. VTB Group operates international network of affiliates and subsidiaries with over 20 banks and financial companies in 19 countries worldwide. VTB offers its services in several regions including the CIS, Europe, Asia, and Africa. In the Russian market, VTB Group is highly ranked based on all major banking indicators.

Listing storyIn 2007, VTB Bank raised a total of USD 7.9bn via GDR offering in London and share offering on MICEX and RTS. The deal was eight times oversubscribed and resulted in a 22.5% free float.It was the largest global IPO by a banking institution in 2007. VTB Bank became the first Russian bank to offer Global Depositary Receipts (GDR) on the London Stock Exchange (LSE).

In February 2011, VTB Bank completed a secondary share offering rising further USD 3.3bn on LSE.

After listingVTB Bank has used the proceeds to develop and expand its retail, corporate and investment banking operations in Russia and CIS. It delivered a strong top-line performance in the consecutive years and established high quality portfolio of retail and corporate loans.

VTB is one of the most liquid securities on the International Order Book and is a part of the FTSE Russia IOB index.

The largest global IPO by a banking institution in 2007

Source: www.RussianIpo.com and publicly available information. Please refer to the end of the presentation for legal disclaimer

Market Cap: USD 35bn

Main Market – Standard Listing, Depositary Receipts

Admission Date:Country of

incorporation:Main country of

operation: Money Raised at

Admission: TIDM:IPO advisers:

17 May 2007RussiaRussia$7,9bn

VTBRCitigroup, Deutsche

Bank, Goldman Sachs, RenCap,

Index: Website:

FTSE Russia IOBwww.vtb.com

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Case Study: Petro Matad

Company Profile

Petro Matad is the parent company of a group focused on oil exploration, as well as future development and production in Mongolia. The Group’s principal asset is the Production Sharing Contract (PSC) over Matad Block XX, a petroleum block with an area of 14,250km2 in the far eastern part of Mongolia, near the Chinese border. Recently the company signed two more Production Sharing Contracts on Bogd Block IV and Ongi Block V, a total of approximately 71,000km² in central Mongolia.

Listing story

Petro Matad is the first substantially Mongolian owned company to have its shares admitted to trading on a major international stock exchange. Since its Introduction to AIM, Perto Matad has successfully came back to the market multiple times and raised a total of US$67.4mln in further issues. Its Market capitalisation increased more than 15 times since its admission to AIM in 2008.

The first Mongolian company to join a major international stock exchange1

Source: publicly available information. Please refer to the end of the presentation for legal disclaimer

AIM market – Introduction

Admission Date:Country of incorporation:Main country of operation: Avg. Daily Trading Value

(6m)Further Money RaisedFree-floatTIDM:IPO advisers:

1 May 2008UK

Mongolia$1.6mln

US$67.4mln61%

MATDHanson Westhouse,

PKF, Norton Rose

Index: Website:

FTSE AIM 100www.petromatad.com

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Market Cap at IPO: $36.0mlnMarket Cap as at 05/2011: $540.1mln

1 - first substantially Mongolian owned company

24Please refer to the end of the presentation for legal disclaimer

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The London Stock Exchange is the most international exchange in the world, with close to 600 international companies from over 110 countries, listed and traded on its markets.

The London Stock Exchange offers a wide choice of routes to market. The choice of markets is open equally to UK and international companies, and differentiated trading platforms offer tailored solutions to maximise liquidity and investor participation.

We provide cost-efficient access to the world’s largest pool of international equity assets.  Over USD 1.85 trillion of equities are managed out of London, with USD 1.26 trillion invested in international equity assets, more than any other major financial centre.

With close to 3,000 companies quoted on its markets and over 500 member firms, the London Stock Exchange Group operates one of the most liquid equity marketplaces globally.

Conclusions

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