EXCHANGE NEWSWIRE, 23 June 2011
LSE-TMX merger: Institutional Shareholder Services (ISS) said the merger with LSE “should allow TMX Group to achieve the cost synergies associated with the combination of technology platforms” and “leverage the combined entity’s depth of liquidity”, and that there is little incentive for shareholders to support Maple Group’s offer given the amount of leverage involved. The recommendation came after LSE increased its bid to approximately C$49 per share through a C$660m special dividend, after which Maple also revised its offer to around C$50 per share.
TMX: Maple Group proposed combining TMX’s Canadian Derivatives Clearing Corporation (CDCC) with Canadian Depository Services (CDS), the equities clearing house controlled by the large domestic banks. Maple Group also stated that “unlike under the LSE acquisition, CDCC, an institution vital to the Canadian economy, would remain under Canadian control following completion of the Maple acquisition”.
NDAQ’s proposal to list shares in companies which stockpile commodities was blocked by SEC, which stated that such stocks would be vulnerable to manipulation. SEC also said “a liquid market may not exist for the underlying commodity or other raw material to be held by the commodity-stockpiling company”, which value “would depend almost exclusively on the value of the underlying commodity”.
CBOT’s former director Ann Berg advocated for CFTC to release more information on the size of orders being put into each type of market player in CBOT’s US agricultural commodities markets. Berg also said that the increasing correlation between on- and off-exchange markets and index commodities demonstrate the growing “financialization” of agricultural markets, and she expects greater scrutiny of cash markets and for Europe to implement more tools to control price volatility.
LCH.Clearnet will provide clearing services to NYX’s MTF, NYSE BondMatch, starting from July 11.
HKEx CEO Charles Li said that his exchange has a “more prescriptive system for vetting issuers”, in response to the ongoing Chinese accounting scandals which resulted in Chinese companies being listed in the US “particularly through reverse mergers”. Li also said that these fraud cases “wouldn’t have seen the light of day here”.
Treasury Market Association of Hong Kong (TMA) will launch a daily fixing for the exchange rate of the offshore RMB (CNH) against the USD starting June 27. TMA’s market practices committee chairman Lawrence Lam commented that “the availability of a representative fixing will be conducive to further development of RMB products in Hong Kong, which will be an essential element for the further expansion of Hong Kong’s RMB offshore business”.
Provided By: Equity Research Desk, www.erdesk.com
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