TMX's Kloet says too soon to decide on Maple bid

Fri Sep 30, 2011 3:51pm EDT
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By John McCrank and Pav Jordan

TORONTO (Reuters) - Behind the scenes talks between TMX Group (X.TO: Quote) and suitor Maple Group have yet to bear fruit, but TMX head Thomas Kloet has not ruled out backing the C$3.8 billion ($3.7 billion) hostile bid for Canada's largest stock exchange operator.

"We are trying to find that out," Kloet said, when asked if he would consider backing a deal that would put the Toronto Stock Exchange in the hands of many of the country's big banks. "I don't really know the answer to that," he said in an interview with Reuters on Friday.

He added that a friendly deal was only possible if regulators support the Maple plan, and that it is impossible to say how long the regulatory review process will take.

"I think that, when you agree to a deal, you have to agree to a deal that has a likelihood of being executed," he said. "In any of these deals ... and in this one in particular, you have a highly regulated organization. What the market has to consider is the regulatory risk of doing a deal."

Shares of TMX were up 0.54 percent at C$40.76 on Friday afternoon, well below Maple's C$50 bid.

On Thursday, Maple, a consortium of heavy-hitting Canadian financial institutions, extended its deadline to October 31 for TMX shareholders to tender to the bid.

It was the second extension in under two months as Maple works to secure shareholder and regulatory support for its offer, which it launched in response to a friendly takeover bid for TMX by the London Stock Exchange (LSE.L: Quote).

The LSE's failed to gather enough shareholder support in the face of Maple's competing offer.   Continued...

<p>TMX Group CEO Tom Kloet speaks during a news conference regarding the merger of the TSX and the London Stock Exchange (LSE) in Toronto, February 9, 2011. REUTERS/Mark Blinch</p>