Maple Group Acquisition Corp, made up of four of Canada's leading banks and the nation's largest pension fund administrators, said on Sunday it is offering C$3.6 billion to take over the TMX Group.
The C$48 per share cash and equity takeover proposal from Maple Group trumps a friendly $3 billion bid from the London Stock Exchange, which critics say would move control of the country's largest stock market to London.
We believe our offer constitutes a superior proposal under which shareholders would receive cash, plus the opportunity to continue to participate in the company's ongoing growth, Maple spokesman Luc Bertrand, vice-chairman of National Bank Financial Group, said in a statement.
On completion of the transaction, shareholders of TMX Group would own about 40 percent of Maple's outstanding shares. Pension fund investors would own about 35 percent and the bank-owned investment dealers would own 25 percent.
No shareholder of Maple would own more than 10 percent of Maple's total shares outstanding, Maple said.
The Maple Group said it consists of five pension funds -- including Alberta Investment Management Corporation, Caisse de depot et placement du Quebec, Canada Pension Plan Investment Board, Fonds de solidarite des travailleurs du Quebec (F.T.Q.) and Ontario Teachers' Pension Plan Board.
Banks on the deal include CIBC World Markets, National Bank Financial, Scotia Capital and TD Securities Inc.
Maple said that under the terms of its proposal it would acquire all of the issued and outstanding common shares of TMX Group for $48 in cash per TMX share or one common share of Maple per TMX share, in each case subject to pro ration.
The maximum cash payable under the proposal is C$2.5 billion and the maximum number of Maple shares issuable is 22.5 million.
On a prorated basis, Maple said each TMX Group share would be exchanged for C$33.52 in cash plus 0.3016 of a Maple share. It said the proposal represented a 24 percent premium to the implied value of the LSE's offer.
(Reporting by Pav Jordan in Toronto; Editing by Richard Chang)