| The Singapore Exchange (SGX) has announced its plans to launch a A$8.4 billion takeover offer of the Australian Stock Exchange (ASX Ltd), Asia’s fifth largest stock market. The SGX, which is among the world’s largest exchanges, has proposed to buy the Australian exchange via a Scheme of Arrangement using a combination of cash in Australian dollars and new SGX shares. It will pay A$22 cash (US$21.3) and 3.473 new SGX shares for each ASX share, valuing the ASX at A$48 (US46.89) a share. At the current bid price, the combined exchange group – ASX-SGX Limited – would have a market capitalisation of approximately A$16 billion (US$15.5b). The entity would also be the second largest listing venue in Asia Pacific and offer the world’s widest range of Asia Pacific equity, fixed income and commodity derivatives with more than 400 contracts from over ten countries, including Australia, Greater China, India and Japan.
The SGX has secured financing for the proposed combination through a bridge facility arranged by Australia and New Zealand Banking Group Limited (ANZ) and Deutsche Bank AG Singapore Branch. Apart from court approval and approval by shareholders of both SGX and ASX, the transaction is contingent on various regulatory approvals, with the Australian Treasurer, Wayne Swan, to have the final say on whether the deal will be allowed. So far, it appears that ASX shareholder sentiment is positive, however some parties have expressed concerns regarding the proposed deal, including the fact that the Singapore Government owns a 23 percent stake in the SGX. Clayton Utz and Allen & Gledhill LLP are advising the Singapore Exchange in relation to the proposed transaction. Clayton Utz’s team was led by partners Rod Halstead and Karen Evans-Cullen, whilst Allen & Gledhill LLP’s team was led by partners Lucien Wong and Prawiro Widjaja. A team from Stamford Law Corporation, led by senior director Lee Suet Fern and director Yap Lian Seng, is advising ASX Ltd as to Singapore law. |
