The London Stock Exchange has sweetened its friendly offer for the TMX Group with an enhanced dividend, bringing the value to $4.1 billion for the operator of the Toronto Stock Exchange.

LSE added a cash component in the form of C$4 dividend per share to TMX shareholders, while LSE shareholders will receive 84.1 pence per ordinary share, sweetening the bid by C$660 million ($680 million).


The thing that would impress me more in the longer term is that they are maintaining the same dividend yield basis on this company, so that's a positive.

Giving back some of our own money, that's also positive - it'll give you some cash, so that means, let's look at the stock and say C$44.20, so I get C$4 back, so it's C$40.20, combined company -- it's probably worth that, I would think.

There is a speculative premium here and they are trying to match the speculative premium with some cash up front. On the Maple deal, I end up with some cash ... and end up with Maple shares, which is a company controlled by its customers, and therefore, what pricing power do you have? And how are they going to value Alpha when they roll it in there?

I think Wellington used the phrase at Waterloo that it was a close-run thing, and that phrase is probably going to be applicable here -- this is a close run deal.

I think the other side are going to come back with something more, something different and something more clarified.

I believe markets should be neutral. A market should not be controlled by the biggest proprietary traders and the biggest internalizers of their own trades -- that is they take the other side of the client order -- because the most important thing an exchange does is determine the price of a trade, the price discovery.


As a TMX shareholder, I'm certainly happy to see the offer being sweetened just before we have to go and vote.

One part of the equations where I think it's going to be difficult to make up your mind today is that I think the market was valuing the LSE as if the LSE-TMX merger wasn't going to happen.

So I wasn't really believing that if you took the 2.9 shares and then applied it and that's what TMX would be trading at today.

With them sweetening the bid and potentially increasing their chances of winning it, or at least getting shareholder approval, I'm curious to see how the LSE will trade when it opens up again, and if it trades off, then even with the $4 dividend, perhaps it still won't be enough to get you to the $48 stated by Maple Group.

I guess my first impression is I'm happy to see a bidding war and I'm open-minded, but I want to see how the LSE trades and I'm still a little more intrigued by the Maple bid.