TMX eyes global expansion if Maple deal passes

Thu Jun 7, 2012 7:09pm EDT
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By John McCrank

NEW YORK (Reuters) - TMX Group (X.TO: Quote) will be "uniquely positioned" to expand globally through acquisitions if regulators allow the Toronto Stock Exchange operator to be bought by a consortium of Canadian financial institutions with deep pockets, the company's chief executive said on Thursday.

TMX is awaiting the approval from Canadian regulators for its proposed C$3.8 billion ($3.71 billion) takeover by the Maple Group consortium of 13 Canadian banks, insurers and pension fund administrators.

"Between the banks and pension funds, who have capital, who from my engagement with them are interested in the international expansion that I want to bring to the institution, we are going to be uniquely positioned to be an acquirer of other exchanges around the world," TMX CEO Thomas Kloet said in an interview.

He said he is "hopeful" that the Maple deal will be approved by the July 31 deadline, but he would not object to an extension if necessary.

Kloet thinks big, global exchange deals are necessary as companies look to build out their technology infrastructures, despite a number of mega-deals failing in recent years.

"People are going to continue to scrutinize the value of them, but I don't think they are dead," he said of large cross-border deals.

The exchange industry saw a frenzy of merger attempts in the past year, four of which fell through. Regulators blocked deals between Deutsche Boerse (DB1Gn.DE: Quote) and NYSE Euronext NYX.N, Nasdaq OMX (NDAQ.O: Quote), and IntercontinentalExchange (ICE.N: Quote) and NYSE.

Singapore Exchange Ltd's (SGXL.SI: Quote) bid for Australia's ASX Ltd (ASX.AX: Quote) was blocked by the Australian government, while London Stock Exchange's (LSE.L: Quote) bid for TMX was halted by TMX shareholders, who leaned more toward the Maple transaction.   Continued...