Maple agrees to OSC terms on TMX takeover
By Jennifer Kwan and Euan Rocha
TORONTO (Reuters) - Maple Group said on Thursday it would accept a regulator's conditions on its C$3.8 billion ($3.84 billion) bid for TMX Group (X.TO: Quote), likely paving the way for the elusive takeover of the operator of the Toronto Stock Exchange to go ahead.
The consortium of Canada's largest banks, insurers and pension plans said that if the terms from the Ontario Securities Commission survive a 30-day comment period, it would accept them, allowing Maple to win control of the Toronto exchange in a deal that will give it some 85 percent of Canadian stock trades.
"We believe that the orders published today set out a balanced framework that ensures strong regulatory oversight and accountability following the Maple transaction," TMX CEO Tom Kloet said in a joint statement with Maple.
In a 164-page document, the OSC made clear it was concerned about the transparency of the new exchange and was seeking controls on governance, including restrictions on the make-up of the board of directors and limits on ownership to ensure the new stock exchange operator acts in the public interest.
"The Commission has thoroughly reviewed the regulatory issues raised by Maple's proposal and developed measures necessary to ensure that the public interest is protected," OSC chair Howard Wetston said in a statement.
"Public consultation has been a fundamental part of our review process and we will carefully consider the further input we receive on these orders when making our final determination."
The Canadian Competition Bureau, an independent federal law-enforcement agency, said the OSC's draft rules might "substantially" mitigate its competition concerns on the Maple bid and it would now seek industry reaction to the OSC terms.
Billionaire investor Stephen Jarislowsky said the market saw the latest news as moving the deal closer to completion. Continued...