THE Stock Exchange has announced it will hold a vote among its members on March 15 to decide whether to end two centuries of being mutually owned.

Currently the organisation is owned entirely by the 298 member stockbrokers across the UK.

If 75 per cent or more votes go in favour of demutualisation, shares will be issued in May which can be bought and sold in a limited market operated by blue-blooded City firm Cazenove.

Each member currently has

one share, which could be valued

at up to £1 million apiece if

the demutualisation goes ahead.

Transforming the exchange into a conventional public company is aimed at improving its ability to make decisions quickly.

It will also shift the ownership structure away from the current

situation where small stockbrokers in the regions have a similar weight to the big City and international firms which conduct most trading business.

Although the bigger firms have amassed a few extra shares by taking over smaller brokerages, the balance is still disproportionately skewed in favour of the regions.

It is expected that the likes of giants UBS will be buyers of the shares and smaller regional firms will be sellers.

Gavin Casey, chief executive of the LSE, said the move would also enable it to take part in the expected wave of takeovers and mergers between stock exchanges around the world.

He said: "We are in a strong market and financial position with the resources to compete more effectively in the future."

While Cazenove will match buyers and sellers of the shares initially, a full flotation is likely to follow in around two years, giving the public a chance to take a stake.

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