Maple says working with regulators on TMX bid

Tue Jan 31, 2012 5:48pm EST
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By Jennifer Kwan and Euan Rocha

TORONTO (Reuters) - The group bidding for the Canada's biggest stock exchange said on Tuesday it was trying to ease concerns about its $3.8 billion offer, but it is unclear if any concessions will appease regulators wary of endorsing a near monopoly.

The Maple Group of 13 Canadian financial institutions said it had spoken with regulators about stock trading and pricing at the Canadian Depository for Securities (CDS), which clears and settles all trades in Canada and which would be part of the new venture formed in the Maple bid for TMX Group (X.TO: Quote).

It extended its offer for TMX, operator of the Toronto Stock Exchange and several other markets, for a fourth time.

"We are in ongoing discussions with the regulators and have made numerous submissions to them, including recently submitting a proposed CDS pricing model and proposing remedies to address concerns regarding equities trading," said Luc Bertrand, vice-chairman of National Bank of Canada (NA.TO: Quote) and the Maple Group's key spokesman.

Canada's Competition Bureau, one of a raft of bodies that must approve the deal, repeated a statement from November that Maple's bid would require "a significant and material change to the competitive consequences" for it to be approved.

A spokesman said the bureau could not comment further while the review was pending.

"The only thing that we've said publicly is that we expressed those concerns on November 29. But until we've actually completed our review and we actually make an announcement, I really can't go any further than that," Greg Scott said.

Maple's bid, if it succeeds, would mean a single group controls some 85 percent of Canadian stock trading. Maple will own the TMX and the Alpha Group, which is the biggest competitor to Canada's premium bourse, in addition to the bank-run CDS clearing house.   Continued...

<p>A Toronto Stock Exchange (TSX) logo is seen in Toronto November 9, 2007. REUTERS/Mark Blinch</p>