FILE - This Thursday, Sept. 22, 2011 file photo shows a sign outside the Stock Exchange in the City of London. The Hong Kong stock exchange said Wednesday Sept. 11, 2019, it has started talks to buy the London Stock Exchange that would value the British company at 29.6 billion pounds ($36.6 billion). The Hong Kong Exchanges and Clearing Ltd. said a deal would provide the London Stock Exchange with a key opening to Asian markets and underpin the British capital’s role as a financial hub. (AP Photo/Matt Dunham, File)

LONDON - The Hong Kong stock exchange wants to buy its storied London counterpart in a move that could gain leverage from the uncertainty that Brexit is creating for British companies and for the U.K. capital as a global financial hub.

The Hong Kong Exchanges and Clearing Ltd. said Wednesday it is looking at a deal that would that value the London Stock Exchange Group at 29.6 billion pounds ($36.6 billion), but has not yet made a firm offer.

A tie-up, it said, would provide the London firm with a key opening to Asian markets and offer big savings. The combined company would be worth over $70 billion.

The approach comes at a time of heightened uncertainty for London and British companies because of Brexit, which threatens to create barriers to trade for the country, particularly in the rest of Europe. Financial services are a big part of the British economy and Brexit would make it harder for them to operate in the other 27 EU countries, so having a foothold in a region like Asia, where economic growth is higher than in Europe, could be an asset.

A weakened pound, which this summer trended at its lowest level since 1985, has also made U.K. companies cheaper takeover targets.

Meanwhile, pro-democracy protests in Hong Kong over the Chinese government's attempts to exert greater control have created uncertainty over the city's role as an international business hub.

"A combined group will be strongly placed to benefit from the dynamic and evolving macroeconomic landscape, whilst enhancing the long-term resilience and relevance of London and Hong Kong as global financial centres," said Charles Li, CEO of the Hong Kong exchange.

A deal would expand on the Hong Kong stock exchange's attempts to diversify its business base, after it agreed in 2012 to buy the London Metal Exchange.

The LSE said in a statement that it will consider the proposal. Shares in the company, which also owns the Milan stock exchange and the Russell Indexes in the U.S., jumped 9% on the news.

The LSE had this summer agreed to buy financial data provider Refinitiv Holdings for $27 billion, and it is unclear how a deal with the Hong Kong exchange would affect that agreement.

The Hong Kong exchange is required to make a binding offer by Oct. 9.

News from © The Associated Press, 2019