Exchanges: Böcker blocked by nixed ASX deal
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CAPITAL MARKETS

Exchanges: Böcker blocked by nixed ASX deal

Australian Treasury stops exchange takeover; Nasdaq, CME possible alternative partners

On April 19, Singapore Exchange posted its lowest quarterly profit in two years, hurt by costs related to a failed takeover bid for Australian rival ASX (above) and putting the spotlight on Böcker’s growth strategy

On April 19, Singapore Exchange posted its lowest quarterly profit in two years, hurt by costs related to a failed takeover bid for Australian rival ASX (above) and putting the spotlight on Böcker’s growth strategy

On April 8 the Australian Treasury did what most in the market had seen as inevitable for months: it blocked the Singapore Stock Exchange’s bid for its Australian counterpart, the ASX. In a forlorn statement, the SGX said: "The parties have agreed to mutually terminate the merger implementation agreement entered into on October 25 2010." There are no opportunities for a revision to the bid; the deal is over. If it had gone ahead, the $8.3 billion deal would have been the first substantial exchange merger in the Asia-Pacific region, and would have created the second-largest hub by number of companies listed and fourth largest by total market capitalization (behind Hong Kong, Tokyo and Shanghai).

That the SGX will not try again reflects the fact that the bid was rejected because of something it could do absolutely nothing about: Australian political sensitivity. Partly this was about the tricky question of Australian national interest – always a nebulous concept – and partly about timing.

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