Canadian business community supports TMX-LSE merger

08:42, June 28, 2011      

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The Canadian Business Community Monday issued an open letter "The Path Forward for Canada's Capital Markets"to support the TMX (Toronto Stock Exchange Group) -- LSE (London Stock Exchange Group) merger plan.

"Our goal is to have exchanges that have independent ownership and management and that operate without conflict in a flourishing competitive market,"said the letter in the name of executives from 11 financial institutions including Union Securities Ltd. and Haywood Securities Inc..

The letter said that "after careful review, it is clear to us that the proposed TMX/LSEG merger protects Canadian regulatory sovereignty, champions Canadian executive management, and maintains competition and a level playing field."

The letter also pointed out that the rival plan from a group of 13 Canadian banks, brokerages and investors known as Maple Group Acquisitions Corp. "has proposed the creation of a national monopoly in which our Canadian exchanges would be owned and managed by many of their most powerful participants, and thus would be burdened by significant conflicts."

In the event that the Maple proposal overcomes its significant regulatory hurdles, it would control nearly 90 percent of all equities trading in Canada. This will virtually eliminate market competition, said the letter.

"As Canadians we should proudly lead by example and look boldly and confidently to a more international future. This future includes a strong independent stock market at the heart of our financial and business community," the letter said.

TMX's board rejected Maple's bid on Friday. Maple increased its price and said it was open to paying TMX a break fee if Maple could not convince competition regulators to endorse its plan but TMX said that there were still too many risks.

Source: Xinhua
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