Tokyo Stock Exchange to buy Osaka Securities Exchange

Business

Tokyo Stock Exchange to buy Osaka Securities Exchange

Close

Tokyo Stock Exchange has said it would offer to buy Osaka Securities Exchange this week.

10 July,2012 05:54 pm

The purchase would see Tokyo offer 480,000 yen ($6,000) per share for its smaller rival.The offer was a 24-percent premium to Osakas average closing stock price over the three-month period through November 21, the day before the two exchanges announced their merger plan, according to Dow Jones Newswires.The offer period would last from Wednesday through August 22 with the merger planned for January 2013, although it must still win shareholder approval.Tokyos exchange, the centre of share trading in Japan with leading names including Toyota and Sony, said it planned to buy as much as 66.7 percent of the Osaka bourse.The derivatives-trading focused Osaka exchange on Tuesday said in a separate statement it had agreed to the takeover bid that would create the worlds third-largest bourse behind leader NYSE Euronext and Nasdaq OMX Group.The bourses hope that their combination, to be called Japan Exchange Group, will save costs and boost the nations securities market amid stiff competition from overseas rivals and a flurry of merger announcements.The environment surrounding both companies is characterized by increasingly fierce competition among exchanges across borders, the Tokyo exchange said in a statement Tuesday.It added that new technology has resulted in advanced financial trading systems that allow companies and investors to choose... the market with the best environment for procuring or investing funds.But some analysts have warned that the merger alone would do little to boost Japans weak initial public offering market or stoke a surge in transactions.