Carsten Kengeter probed over €4.5m share deals ahead of LSE merger talks

German prosecutors have raided the Frankfurt apartment of Deutsche Börse chief executive Carsten Kengeter and the company’s offices amid a probe into suspected insider share dealing ahead of the group’s planned merger with the London Stock Exchange.

The Frankfurt prosecutor’s office said the investigation related to talks about a merger that took place between the management of Deutsche Börse and the LSE between July and early December 2015.

The prosecutor’s inquiry centres on Kengeter’s purchase of Deutsche Börse shares worth about €4.5m (£3.8m) on 14 December 2015. Two months later, in February 2016, Deutsche Börse and the London Stock Exchange unveiled their merger plans, an announcement which sent their share prices soaring.

The prosecutor’s office said several prosecutors and civil servants from the Hessen state office of criminal investigation had carried out searches at the company’s headquarters in Eschborn near Frankfurt and Kengeter’s private apartment in Frankfurt on Wednesday. Prosecutors said the searches were “intended to clarify the course of the negotiations until 23 February 2016,” when the merger plans were made public for the first time.

Kengeter, who attended the company’s annual reception in London on Tuesday evening, was not present during the raids.

A Deutsche Börse spokesman said Kengeter had always been “transparent” about the share purchase.

The operator of the German stock exchange said on Wednesday that the Frankfurt public prosecutor’s office “today investigated at Deutsche Börse in respect of a share purchase by its chief executive officer which was carried out on 14 December 2015”.

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