LONDON — JPMorgan Chase & Co. is buying a 4.7% stake in the London Metal Exchange from bankrupt broker MF Global Holdings for GBP25 million ($39 million), three people familiar with the matter said Tuesday.

JPMorgan Chase bought the stake in an auction process handled by MF Global's administrator, KPMG. The deal will need to have the LME board's approval before it can be closed, a person familiar with the matter said.

The deal is expected to be formally announced this week, the people said.

JPMorgan Chase already owns a 6.2% stake in the LME. The recent purchase, once closed, would increase JPMorgan Chase's stake in the exchange to 10.9%.

The deal values LME's total equity at GBP532 million ($836 million), according to a Dow Jones Newswires calculation.

The LME declined to comment on the matter.

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