The board of London Stock Exchange Group plc has formally rejected the hostile bid from Nasdaq.

The LSE posted its shareholder circular today, in response to the final offer posted by Nasdaq on Dec. 12. The board unanimously rejects Nasdaq’s offer calling it “wholly inadequate” and saying that it “substantially undervalues” the exchange, and “fails to reflect the unique strategic position and the powerful earnings and operational momentum of the business”.

“Over the last 12 months, records have tumbled in terms of money raised as well as the volume and value of trading on our markets,” said Chris Gibson-Smith, chairman of the exchange. “This is further confirmation of the significant progress we are making towards the realisation of our vision to be ‘the world’s capital market’. For the second time this year, Nasdaq is offering a wholly inadequate price for the company and shareholders should reject the offer.”

In response, Nasdaq issued a statement indicating that its board believes that its offer reflects: a realistic assessment of standalone value in the context of the new competitive threats which LSE will face; a premium for control; and, a fair share of synergies. It claims that the LSE’s current share price is not supported by the company’s standalone prospects and is only sustainable because of Nasdaq’s bid.

Commenting on the circular, Nasdaq president and CEO Robert Greifeld said, “The board of LSE is ignoring the elephant in the room at its peril. Its recent growth in revenues has taken place without a proper sharing of benefits with users. Regulatory changes, increased consolidation and customer group competition are likely to bring significant downward pressure on LSE’s revenue model going forward. There is nothing in the circular which causes us to change our view onvalue.”