LSE chief Furse's defensive mettle may pro

By Daisy Ku

LONDON (Reuters) - Clara Furse has proved her mettle at the helm of the centuries-old stock market by seeing off a series of suitors, but tough markets are a different challenge just as she prepares to step down.

In the worst economic crisis in 80 years, her defensive strength in seeing off bidders who could have been welcome partners could yet turn on the 51-year-old Canadian, analysts say.

Born to Dutch parents, Furse oversaw the acquisition of Borsa Italiana last year but has failed to build up a meaningful derivatives business, making the group more vulnerable to economic downturns.

"The bourse is essentially still a cash market and is increasingly competing on price. The lack of a credible derivatives strategy is the LSE's Achilles heel," said Mondo Visione managing director Herbie Skeete.

Furse, a multilingual ex-derivatives trader, was parachuted into the London Stock Exchange (LSE.L) in January 2001, half a year before the exchange floated on its own market.

Made a Dame of the Court this summer, she was the first woman to lead the venerable gentlemen's club, playing a defensive game from the outset as London vied to become the financial centre of the world.

She successfully saw off hostile takeover bids from Australian group Macquarie, German exchange Deutsche Boerse (DB1Gn.DE) and trans-atlantic group Nasdaq OMX (NDAQ.O).

But a herd of brash new rivals springing up after the introduction of new European Union financial rules known as MiFID has forced the LSE to cut prices.