London Exchange Sweetens Its Toronto TMX Bid

Wednesday, 22 Jun 2011 02:57 PM

 

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The London Stock Exchange sweetened its friendly bid for the operator of the Toronto Stock Exchange to $4.1 billion on Wednesday, raising the price above the hostile offer from a Canadian consortium.

Stepping in a week before TMX Group shareholders vote on the London offer, the LSE said it added some C$660 million ($680 million) to its bid in the form of special dividends of C$4 per TMX share and 84.1 pence per ordinary share of the LSE.

"As a TMX shareholder, I'm certainly happy to see the offer being sweetened just before we have to go and vote," said Mathieu Roy, a TMX large shareholder and vice president of Louisburg Investments.

"I guess my first impression is I'm happy to see a bidding war and I'm open-minded. But I want to see how the LSE trades and I'm still a little more intrigued by the Maple bid."

Maple Group, a consortium of Canadian banks, pension funds and financial services firms, has offered C$48 a share in cash and stock, or some $3.8 billion.

TMX also formally rejected the bid from Maple, which bills its made-in-Canada proposal as a better alternative to the London Stock Exchange offer.

TMX said Maple failed to provide any more clarity or proof its offer would lead to a superior price.

TMX said it has not changed the date of its June 30 shareholder meeting to vote on the LSE bid.

A deal would still face regulatory hurdles, including approval from Industry Minister Christian Paradis, who will have to determine if the offer is of net benefit to Canada.

The LSE and TMX say they plan to create a Trans-Atlantic partnership with a strong position in mining and resource firms.

© 2014 Thomson/Reuters. All rights reserved.

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