STOCKHOLM, 18 August 2007 — Dubai-based market operator Borse Dubai yesterday presented a $3.97-billion (2.94-billion-euro) bid for Nordic stock market operator OMX, valuing the group 13.7 percent higher than a rival bid by NASDAQ.
The Borse Dubai offer consists of 230 Swedish kronor in cash for each OMX share, valuing the group at 27.7 billion kronor, a Borse Dubai statement said.
In May, NASDAQ offered a cash-and-share deal equivalent to 208.1 kronor per OMX share in a friendly takeover aimed at creating the world’s second-biggest exchange.
Given the current OMX share price, the NASDAQ offer was now seen as being worth around 200 kronor per share.
The OMX share was down 0.44 percent in midday trading in Stockholm at 228 kronor.
OMX, which operates the stock markets of Copenhagen, Stockholm, Helsinki, Reykjavik, Riga, Tallinn and Vilnius and which had previously agreed to the NASDAQ offer, said yesterday it was examining the Borse Dubai bid.
The price offered by Dubai was a 38.6-percent premium on the average price of the OMX share over the 20 trading days (165.9 kronor) prior to May 23, the last full trading day before NASDAQ presented its bid, Borse Dubai said.
Borse Dubai has acquired 4.9 percent of the capital of OMX and also holds, through a wholly-owned subsidiary, options to buy a further 23.5 percent, thereby controlling 28.4 percent of OMX. The US exchange said in a statement that it continued to view its bid as “superior,” but noted that, if need be, it had the “financial wherewithal to consider other approaches.”
The bid by NASDAQ, the second-biggest US stock exchange, was aimed at expanding beyond domestic borders after its failed bid in February to buy the London Stock Exchange (LSE).
But analysts said they expected Borse Dubai to win the battle with NASDAQ.
“The bid was expected. Speculation has been ongoing for about five months, but whether it will be enough to secure the deal ... That depends on whether NASDAQ will hike their bid, which is now dead (in its current form),” Fredrik Gutenbrant at Cheuvreux Nordic told the news agency Thomson Financial News.
“I think Borse Dubai will manage to get a lot of (acceptances) with this bid, since NASDAQ was getting a lot of support (for its lower-priced offer),” he said. A strategist from a major Swedish bank agreed the game in its current form looked to be over for NASDAQ.
“Dubai’s bid is clearly quite a bit over NASDAQ’s bid, and in this shaky market, people should prefer an all-cash bid,” he said.
“At these levels, OMX is terribly expensive, but the United Arab Emirates have a printing press. They can pay whatever is necessary to acquire an asset they deem important,” he said.
“NASDAQ is listed and has other considerations.”
The Swedish state holds 6.6 percent of OMX. The centre-right government has previously announced plans to sell its stake as part of a broader privatization program. It said it would examine the Dubai bid.
