Merger of Australia, Singapore Stock Exchanges Planned

Sydney, Australia (AHN) – Singapore’s stock exchange is poised to take over its counterpart, the Australian Securities Exchange (ASX), forming a US$13.8 billion alliance, through a US$6 billion bid by Singapore to be announced Monday, according to media reports.

Commenting on the reported merger, a spokesman for the Australian exchange said Friday, “ASX does not have any information to disclose at this time but has observed an increase in the ASX share price today.” The ASX called for a two-day trading halt last week prior to the start of the weekend.

Former Merrill Lynch Australia chief executive Greg Bundy told The Australian that the merger was in line with the global trend towards consolidation between exchanges, ahead of the planned merger of the Japanese and Hong Kong bourses.

“Singapore and Australia are the most progressive of the exchanges in this time zone, they are the market leaders, and it could be they are getting together to pre-empt the involvement of Japan and Hong Kong both of which have had their issues,” he said.

The merger would still be subject to government approval, particularly by the Foreign Investment Review Board. It is expected to enhance cultural ties between the two countries as well as accelerate financial links into Asia by Australians who can now invest easily in Asian shares, and vice versa for Asian investors over Australian shares.

Singapore stock exchange chairman J.Y. Pillay and its chief executive, Magnus Bocker, will maintain the same positions in the merged exchange while ASX chairman David Gonski will assume the post of deputy chairman.

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