What's going on?

London Stock Exchange Group (LSE) announced that it was in talks to buy market data provider Refinitiv for $27 billion on Saturday � and unusually, LSE�s stock ticked up 15% on Monday.

What does this mean?

When one company buys another, the buyer�s stock usually falls. That could be because it�s paying more than investors think the firm is worth � or because a difficult integration could stifle profits in the short term.

But that doesn�t seem to be the case here: investors bought up LSE�s stock in droves. That�s likely because Refinitiv � which specializes in data and analytics tools � could help LSE move away from the business of matching stock buyers with sellers and toward a much more lucrative gig: providing information services to data-hungry companies, including those it already deals with.

Why should I care?

For markets: A data with destiny.
LSE�s revenue has seen a big shift in the last decade as trading�s become more computerized. Nearly 40% now comes from information services � roughly double what it makes from �traditional� businesses like stock trading. Big institutional investors are also increasingly looking to lower costs as their customers switch to lower-fee investments. With Refinitiv, LSE hopes it�ll become even less dependent on shrinking revenue sources and in turn grow earnings faster than its rivals � potentially convincing their investors to switch allegiances to LSE and buy its stock instead.

The bigger picture: Go big or go home.
It looks like LSE�s new CEO is following the example set by his predecessor, who spent big on other data deals. But this mammoth new move comes with mammoth risk: Refinitiv has $12 billion worth of debt from being bought out by private equity firm Blackstone (which will make nearly double its money from the sale). LSE has cost-cutting plans for the future � $430 million per year for the next five � but any setbacks to its income could leave it floundering with massive repayments.