Maple extends bid for Canada's TMX Group; to buy Alpha

Mon Apr 30, 2012 6:50pm EDT
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By Jennifer Kwan and Euan Rocha

TORONTO (Reuters) - The consortium of Canadian financial institutions bidding for the operator of the Toronto Stock Exchange extended its offer for a seventh time on Monday and announced two deals that will help it realize an ambitious plan to transform Canada's stock trading landscape.

Prolonging its C$3.8 billion ($3.85 billion) bid for TMX Group (X.TO: Quote) to May 31, Maple Group said it had reached agreements to buy Alpha Trading Systems, Canada's second biggest stock trading venue, and the Canadian Depository for Securities Ltd clearing system.

It will pay C$175 million for Alpha, owned in part by Canada's big banks, and C$167.5 million for CDS, it said.

"These agreements are important milestones in our effort to realize our vision for a stronger and more globally competitive exchange and clearing organization," Maple spokesman Luc Bertrand said in a statement.

"We remain focused on securing the regulatory approvals required to complete the proposed transactions."

Maple, whose 13 members include most of Canada's biggest banks as well as pension funds, a giant insurer and other financial groups, has repeatedly said its bid is contingent on winning regulatory approval for wrapping in Alpha and the CDS.

That will create an exchange with some 85 percent of Canadian stock trades.

Critics have argued that the deal would concentrate too much power in the hands of a single player, creating a near monopoly of stock market trading and clearing operations. TMX shares have consistently traded below Maple's C$50 a share offer amid doubts about whether anti-trust authorities will okay the deal.   Continued...

Luc Bertrand, Maple Group spokesman and vice-chairman of National Bank Financial poses for a photograph in Toronto, July 6, 2011. REUTERS/Mark Blinch