Posting of Class 1 Circular

London Stock Exchange Group PLC
23 July 2007

London Stock Exchange Group PLC

23 July 2007

London Stock Exchange Group PLC ('London Stock Exchange') merger with Borsa
Italiana Group ('Borsa Italiana')

Posting of Class 1 Circular

Further to the joint announcement by Borsa Italiana and London Stock Exchange on
23 June 2007 regarding the proposed merger between the two companies (the 
'Proposed Merger'), the London Stock Exchange announces that a circular (the
'Circular'), notice of the extraordinary general meeting ('EGM') and a form of
proxy for use at the EGM is expected to be posted to London Stock Exchange
shareholders later today.

The Proposed Merger is conditional upon the approval of both Borsa Italiana and
London Stock Exchange shareholders respectively.  For London Stock Exchange
shareholders, the EGM to approve the Proposed Merger will be held at 10am on 8
August 2007, at Plaisterers' Hall, One London Wall, London EC2Y 5JU.  This will
follow an EGM of Borsa Italiana's shareholders which will take place earlier the
same day.

The Proposed Merger is the most important step yet in realising the shared
vision of the London Stock Exchange and Borsa Italiana to be the world's capital
market. The Proposed Merger will bring together two highly efficient and
complementary businesses, coupling the strengths of Borsa Italiana in Italian
cash equities, derivatives, securitised derivatives, fixed income products and
efficient post-trade services with those of the London Stock Exchange in UK and
international equities.  The Proposed Merger will:

• Diversify the product and customer bases of the two exchanges;

• Create cross-access opportunities for issuers, intermediaries and
  investors and enlarge the liquidity pool thereby reducing trading costs and 
  the cost of capital; and

• Leverage the highly compatible and broad range of skills to accelerate
  the growth of its marketplaces.

Notwithstanding the high levels of efficiency already achieved by the two
companies, the Proposed Merger is expected to achieve pre-tax cost synergies and
other transaction-related cost savings of £20 million (€29 million) annually,
with the full run-rate being achieved in the financial year 2010. Furthermore,
given the highly complementary nature of the two businesses and the prospects
for growth that underpin the Proposed Merger approximately £20 million (€29
million) of annual revenue synergies are estimated to be achieved in the
financial year 2011.

From this position of increased strength, with excellent growth prospects, the
Board of the Enlarged Group will continue to explore ways of creating
shareholder value through strategic and other opportunities.

London Stock Exchange has a policy of active capital management which it intends
to continue. The Proposed Merger includes the possibility of up to £350 million
cash being used in the merger and London Stock Exchange has arranged appropriate
banking facilities. On the assumption that this cash will not be required for
the purposes of the merger, the Board of London Stock Exchange plans to use this
cash, together with the £96 million remaining from the previously announced
share buy-back programme, to return £500 million to its shareholders by way of
tender offer or market purchases or by a combination of methods, conditional
upon Completion of the Proposed Merger.

The Circular contains further details of the Proposed Merger including the
benefits to shareholders and customers, the key terms of the transaction,
information on Borsa Italiana and the financial effects of the Proposed Merger.

For further information, please contact:

London Stock Exchange Group PLC
Patrick Humphris - Media                 020 7797 1222
Paul Froud - Investor Relations          020 7797 3322

Finsbury
James Murgatroyd                         020 7251 3801

Capitalised terms used, but not defined, in this announcement have the same
meanings as given to them in the Circular.

A copy of London Stock Exchange's Circular, once published, will be available at
http://www.londonstockexchange-ir.com

                      This information is provided by RNS
            The company news service from the London Stock Exchange