Singapore Exchange Ltd’s bid for ASX Ltd has been judged by its opponents without adequate assessment, Australian Trade Minister Craig Emerson said.
“There’s been an unfortunate prejudgment of this proposal,” Emerson said on Friday, according to a transcript of his comments e-mailed by the Australian Department of Foreign Affairs and Trade yesterday. Those opposed to the offer are “raising all sorts of doubts about it before any assessment has been made,” he said.
Singapore Exchange, part-owned by the city-state’s central bank, on Monday offered to buy the owner of Australia’s stock exchange for cash and shares in a deal worth A$8.1 billion (US$8 billion), according to Bloomberg’s calculations based on Singapore Exchange’s closing price of S$8.80 yesterday.
The transaction requires an amendment to Australia’s Corporations Act, approved by parliament, which prohibits anyone from owning more than 15 percent of ASX. Singapore Exchange needs the support of the minority Labor government, which hasn’t decided its stance on the deal, and at least four other legislators in the lower house of parliament to approve the bid.
ASX fell 2 percent to close at A$37.10 in Sydney yesterday.
The transaction must be approved by Australian Treasurer Wayne Swan under foreign investment rules and by the Australian Securities & Investments Commission, the Monetary Authority of Singapore and both sets of shareholders.
Meanwhile, Singapore Exchange plans to quote American depositary receipts (ADRs) of Indian, Taiwanese and South Korean companies by the first half of next year.
The bourse, Asia’s second-largest publicly traded exchange by market value, will first build up trading volumes on the 19 Chinese ADRs it started trading last week, Rick Aston, head of product sales, said in an interview in Hong Kong on Thursday. Those ADRs range from PetroChina Co (中石油), Asia’s biggest company by market value, to search-engine operator Baidu Inc (百度).
“We’re essentially bringing these Asian companies back to Asia,” Aston said. “We think this will bring in new investors and add volume.”
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