While London Stock Exchange has reported a significant improvement in its full year results today the focus remains on the potential bidding war taking place after this week’s reports that Intercontinental Exchange (ICE) was weighing up a counterbid to the talks currently taking place between the LSE and Germany’s Deutsche Boerse.

This isn’t the first time the LSE has been in the spotlight as a takeover/merger target, with the NASDAQ interest over 10 years ago and the TMX merger five years ago.

The share price for the LSE had been trending high into the end of last year on an expectation of a payout when the company receives the proceeds of the sale of the asset management side of the Russell Investments business, which it bought in December 2014.

This deal with TA Associates is due to complete later this month and while most of the cash is likely to go into paying down debt we’ve also seen an increase in the dividend as from a nice windfall of £770m, however events have since moved on with the recent M&A activity currently swirling around the business.

The acquisition of the Russell business has helped see overall revenues rise sharply over the last 12 months. We already got a taster of the effect this had on income when the company announced its Q3 results in October last year, when we saw an 85% rise in revenues for that quarter.

The full year results showed income up by 72%, while operating profits rose by 27% to £709m, both above expectations while the company announced an increase of the final dividend by 20% to 25.2p a share.

Given these results it’s not hard to see why Deutsche Boerse and ICE are both interested and the fact that London is the centre of the European IPO market, where we’ve seen 72% of the overall IPO activity in the last twelve months. London’s appeal as a centre for private equity and hedge funds makes the overall task of raising capital that much simpler in a very confined geographical location, and while some have cited the upcoming Brexit  referendum as a risk to London’s status, it’s not immediately apparent that it would undermine any deal.

While no-one has a crystal ball many predicted that not joining the euro would see London’s crown slip, but this proved to be too pessimistic a view. First of all, London is the centre of venture capital, private equity and hedge funds and given the time zone advantages, English being the global language of finance, the UK has managed to thrive, while the regulatory environment is less restrictive than it is in Europe, and that isn’t likely to change.

It could be argued that opting out of the working time directive has also helped, in that finance has never been about working a 35 or 48 hour week, but a global business, where deals have to get done at any time of the day.

In particular the LSE’s clearing business LCH.Clearnet is the main draw, though any successful bid may see any suitor offload the stakes in Borsa Italia and the French part of the Clearnet business.

While both bidding parties have clearing businesses of their own the integration of Clearnet could potentially offer huge savings with a one size fits all clearing house for their clients, though the trade-off might be that the Paris based part of the business might need to be spun off.

It is notable that revenues in LCH.Clearnet showed a fall of 8%, suggesting that the volatility over the last six months has seen some evidence of diminishing turnover.

That being side harmonising the clearing business would offer significant cost savings given how the clearing house handles both sides of the trade in any financial transaction and charges a fee on both sides.

The next few weeks are likely to be interesting ones for the LSE, and while there is no guarantee that a deal will get done; the outcome will be closely watched from across the globe, and with the share price at record highs a failure to come to a deal could make the shares vulnerable to a pull back.

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