Nasdaq Stock Market Inc and Borse Dubai, aiming to muscle out potential rival bidders, boosted an offer for OMX to $4.9 billion on Wednesday and pushed close to a majority stake in the Nordic exchange group.
Borse Dubai is offering 265 Swedish crowns ($40.57) per share, up 15 percent from a previous offer of 230 crowns. It has now secured 47.6 percent of OMX in stock or options for shares.
Trading in OMX shares resumed on Wednesday after being suspended but rose above the new bid level with a 2 percent gain to 276.50 crowns as investors saw the possibility of a higher offer.
State-owned Borse Dubai and Nasdaq said the bid values OMX at $4.9 billion, compared with the original $4 billion under the previous Borse Dubai offer.
Borse Dubai Chief Executive Per Larsson said he was in talks with OMX shareholders and hoped to boost the holding in the firm to more than 50 percent fairly soon.
Larsson said in an interview he thought it would be difficult for any other bidder to match the price on offer and also get support from stakeholders in the company. He called the Borse Dubai offer very high.
Nasdaq and Borse Dubai made the preemptive strike for more shares after a Qatar group started buying OMX shares at 260 crowns last week. They said the offer is binding unless a competing offer is made for at least 303 crowns per share.
Analysts in New York said they expect Nasdaq and Dubai to be able to fend off rivals with the sweetened bid.
The developments are incrementally positive for Nasdaq, as it appears more likely to close OMX, with negligibly higher cost, said Fox-Pitt Kelton analyst Edward Ditmire.
Nasdaq shares would reflect this positive, he said.
Sandler O'Neill analyst Rich Repetto said Nasdaq and Dubai's improved offer for OMX indicated a disciplined approach.
We ... doubt that any Western exchange could acquire OMX for over SEK 300 as an accretive acquisition, Repetto wrote in a research note.
Shares of Nasdaq were up $1.04 or 2.9 percent at $37.30 in afternoon trading. The shares have traded between $26.57 and $42.37 in the past 52 weeks.
Borse Dubai agreed with Nasdaq last week to go ahead with its OMX bid and then sell OMX to the U.S. stock exchange company in return for a 20 percent stake in the combined group.
Nasdaq and Borse Dubai also changed the minimum acceptance level to above 50 percent from 90 percent. Larsson said the objective was still ultimately to buy 100 percent of OMX.
The companies said they had irrevocable undertakings from major OMX shareholders Investor and Nordea to acquire their stakes. Investor owned about 10.7 percent of OMX and Nordea 5.2 percent, according to recent industry data.
Nasdaq Chief Executive Bob Greifeld said OMX founder Olof Stenhammar and OMX Chief Executive Magnus Bocker also had agreed to sell their stakes. Stenhammar owned 1.4 percent of OMX and Bocker 0.1 percent, according to market data.
We are talking to other shareholders as well. How soon we will get over 50 percent is difficult to say, but hopefully fairly soon, Larsson said.
Another big shareholder in OMX is the Swedish government, owner of 6.6 percent. The government said it was studying the new offer, which it considered an interesting proposal.
Swedish Financial Markets Minister Mats Odell said the government would present its view in good time before the bid was concluded. Referring to when a deal might be concluded, he said it could be into January.
Sweden had not had any contact with Qatar over OMX, he said.
The Qatar Investment Authority, which last week urged OMX shareholders to take no action on the Nasdaq/Dubai offer, began acquiring shares and now owns 9.98 percent.
Qatar Investment, which also bought a 20 percent stake in the London Stock Exchange (LSE.L: Quote, Profile, Research) last week, said its purchases were strategic.
In acquiring the LSE stake last week, Qatar Investment said it did not plan to make an offer for the London exchange but reserved the right to change its position if a third party were to make a bid.
Although Nasdaq and Borse Dubai have secured some key support, the OMX board has not yet thrown its weight behind the new offer.
The board of OMX will take today's announcement into consideration in its assessment of the implications of the structure proposed by Nasdaq and Borse Dubai, the board said.
($1=6.531 Swedish Crown)
(Additional reporting by Anupreeta Das in New York, Adam Cox and Sven Nordenstam in Stockholm, Mathieu Robbins in London)