|UPDATE 2-Maple will extend Aug 8 deadline on TMX bid|
Wed Jul 27, 2011 2:55pm EDT
* Bidder to give shareholders more time to decide
* Group will wait for more clarity in regulatory process
* C$50-a-share offer values TMX at C$3.8 bln
By Pav Jordan
TORONTO, July 27 (Reuters) - A consortium aiming to buy Canada's TMX Group ( X.TO)plans to extend the Aug. 8 tender deadline for its C$3.8 billion ($4.04billion) bid until shareholders can be more confident regulators willapprove the deal, a source within the group said on Wednesday.
A takeover of the Toronto Stock Exchange operator under theMaple proposal requires approval by Canada's Competition Bureauas well as regulators in four provinces. Maple plans tointegrate TMX's exchanges with the Alpha Group alternativetrading system and the CDS trade clearinghouse, raisingantitrust concerns.
"We will extend the deadline as many times as we have tountil the point where we have sufficient regulatory approvalsfor shareholders to be able to tender into a bid with certaintyof the regulatory process," the source said on condition ofanonymity.
The source, who was not authorized to speak on the record,could not say for how long Maple would extend the deadline, butthe likely outcome of the regulatory process would become moreclear by the end of the Canadian summer.
Maple Group Acquisition Corp, whose members include four ofCanada's largest banks, four top pension funds and NorthAmerica's largest life insurer, has offered C$50 a share forTMX.
The bid started out as an all-Canadian alternative to afriendly takeover offer from the London Stock Exchange ( LSE.L),which derailed a month ago when it failed to generatesufficient shareholder support. [ID:nN1E76K29L]
The Maple bid is a hostile offer, but the TMX boardauthorized official discussions with the consortium last week,increasing the possibility of the sides coming to anagreement.
"We are exploring with them how we could get the TMX boardto support our bid and convert it into a friendly deal," thesource said. "The important point here is that Maple is notdisappearing."
The sides have already met once this week and expect tomeet again before Friday, the source said.
The Competition Bureau is expected to rule on the Maple bidby October at the earliest, and November at the latest.
So far the bureau has asked for supplementary informationsurrounding the bid and its investors on one occasion, and moresuch requests are likely as they narrow down concerns.
The bid also needs approval from securities regulators inthe provinces of Ontario, Quebec, British Columbia and Alberta,but the first two provinces are viewed as more importantbecause two of TMX's prime assets are located there.
Maple Group officials met with regulators in Quebec, hometo the Montreal exchange on Monday and in Ontario, where theToronto Stock Exchange is located, on Tuesday.
As a part of the reviews, regulators will open the proposalto a public consultation process that is expected to take 45days.
(Reporting by Pav Jordan; Editing by Frank McGurty)