SGX to push with AGX offer despite political indifference
21 Mar 2011
The Singapore Stock Exchange is expected to launch a last-ditch lobbying effort in Canberra despite indications that politicians from both Singapore and Australia are not keen on the $8.4-billion takeover of the Australian stock exchange by its Singapore rival.
According to analysts, the Singaporeans as also their counterparts in Australia would have a tough time convincing the Gillard government to support the deal. They say the offer has also lost some of its appeal due to the slump in equity markets following Japan's natural disaster and nuclear crisis having effectively reduced the value of SGX's offer.
But with the growing disinterest of the Australian government, the government-owned SGX is not likely to consider an attempt to make the deal more attractive until the Foreign Investment Review Board comes out with its final recommendation on the deal to the treasurer, Wayne Swan, in just over two months' time analysts say.
According to an ASX spokesman, Matthew Gibbs, changes had already been made to the original offer to address concerns, including increasing the number of Australians on the board of a merged exchange.
''We will continue to engage with the politicians during this process and work hard at pointing out that there need not be any concern about a loss of sovereignty and control,'' he said. ''All of the existing regulatory protections that market-users enjoy will be preserved under this merger proposal.''
However, the National Party of Australia, which has already decided to oppose the deal the way it rejected Chinese state-owned Chinalco raising its stake in Rio Tinto in 2009.
