Shareholders in OMX are weighing a $4 billion bid by Borse Dubai for the firm and waiting to see whether U.S. rival Nasdaq sweetens its $3.7 billion offer, Borse Dubai's head said on Tuesday.
Borse Dubai Chief Executive Per Larsson and his Nasdaq counterpart, Bob Greifeld, were in Stockholm to woo shareholders of Nordic exchange operator OMX. Nasdaq said late on Monday it could rejig its offer.
They (shareholders) are looking into what we have offered, Per Larsson told Reuters.
They will pretty much wait and see if Nasdaq decides to change their offer or not. That's an obvious reaction from all major shareholders at this point in time.
He said he was confident that Borse Dubai's 230 crown-per- share cash offer was more attractive than Nasdaq's cash and share bid, worth around 204 crowns a share on Tuesday.
It's the highest price, and the structure to grow and to develop OMX, to take the brand global, to support the technology and to build on the know-how and support the Nordic region is a very attractive offer for all stakeholders, he said.
Nasdaq said on Monday it wanted to sell its stake in the London Stock Exchange and focus on its bid for OMX. It said it aimed to pay off debt with proceeds from its 31 percent stake in the LSE and use the rest to buy back shares.
This in theory should raise its own share price and thereby the value of its offer for OMX.
The Financial Times reported on Tuesday Greifeld saying Nasdaq was also talking to key shareholders to persuade them to take only shares. This would leave it free to offer hedge funds -- which the FT said owned around 25 percent of OMX shares -- a larger proportion of cash.
Nasdaq could not immediately be reached for comment.
Investor AB, the investment vehicle of Sweden's powerful Wallenberg family, said it was ready to take only Nasdaq shares in return for its 10.7 percent stake in OMX.
When Nasdaq made its bid, we had an agreement to take only shares, said Investor spokesman Fredrik Lindgren.
We're now evaluating both bids. And we said that we see large synergies and developing possibilities in a trans-Atlantic combination. So we're still ready to accept only shares.
Larsson said Borse Dubai had received a positive response from OMX stakeholders, some of whom were concerned about the impact on the Nordic markets of a takeover by Nasdaq.
There is a concern about this regulatory spillover from the U.S. market and there is concern about the market model. He said OMX's model would have to change dramatically to be more compatible with the Nasdaq model.
And there is concern that the technology platform in the Nordic region will have to be rewired. All of that is very costly and would affect the market model of all the major players in the Nordic region.
He declined to comment on what Borse Dubai would do if Nasdaq raised its bid.
That is a hypothetical question, he said. We have the best bid on the table today, both when it comes to price and structure.
He also declined to comment on whether Borse Dubai would consider a three-way deal with Nasdaq and OMX or whether Borse Dubai was interested in acquiring the London Stock Exchange at some point.