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Toronto and London Stock Exchanges to merge?
- Thread starter Jonny5
- Start date
Bogtrotter
Senior Member
Yes quite a historic deal. It is of course played as an equal partnership, but undoubtedly the major operations of this new Exchange will eventually be consolidated in one of the two cities. Any bets which one?
TrickyRicky
Senior Member
I don't study the subject but as a laymen observer I don't recall ever having witnessed a corporate "merger". After a few years all mergers look like take-overs. At some point one culture must prevail and it is the culture of the stronger partner. If you have ever experienced this in your own office when a merger or take-over has occured you will know what I mean.
M II A II R II K
Senior Member
Stock Exchange Tower next.
malvern2
Active Member
I have no clue why no one on this forum cares so little about this deal, everyone obesses over sidewalks and colours of glass on crappy condos but this deal could be one of the most important things to happen to this city in a long time. The financial industry which is basically the reason this city is as wealthy as is it has to make a huge decision here, jobs and the citys future as a finacial hub will be determined. Personally i am not happy about this merger which interestingly enough is being called a takeover in London of the TSX but without this deal London will partner up with perhapa the aussie or brazillian markets and leave us behind. Still i'm boggled as to why no really cares though...
Rowe
Active Member
Its a complex issue to look at. I think in order for Canada to make a real impact on the global market... we will have to join up with another exchange in order to really make an impact. The fact the it is with a nation so close to Europe makes it even better.
Both boards of the company support this... so my guess is if this deal doesn't happen, TSX and LSE will just find others to merge with. I don't really see the issue of this since Canada's market is so stable and strong. I don't know much about the financial industry but I would be more concerned if this was with the NYSE.
In terms of a "new building" it would have to be in Toronto. LSE has the CEO and board members (8/15). We should get the new headquarters. Which is always the bigger issue in Canada with company mergers/takeovers.
Both boards of the company support this... so my guess is if this deal doesn't happen, TSX and LSE will just find others to merge with. I don't really see the issue of this since Canada's market is so stable and strong. I don't know much about the financial industry but I would be more concerned if this was with the NYSE.
In terms of a "new building" it would have to be in Toronto. LSE has the CEO and board members (8/15). We should get the new headquarters. Which is always the bigger issue in Canada with company mergers/takeovers.
adma
Superstar
And if the merger doesn't "jump out" at us, it may also be a measure of the geographically-neutralizing effect of on-line trading replacing the trading floor...
TrickyRicky
Senior Member
People dream of glory on the world stage but I am reminded of a Roman proverb that said something like "It is better to be king of your village than second in Rome".
I'm just a layman observer and there will clearly be positives and negatives for various interests, but frankly you don't have to know the details of the deal. What is telling is that the head of the LSE was here in Toronto selling the deal on the day of the announcement. They were not in London selling the deal. You don't have to read the fine print to know what that means from a negotiation perspective. It means we have something they want to their advantage.
Also, if you do look at the deal more closely you will note that the clauses that retain some control in Toronto have time limits and are voided by further consolidations. I think such consolidations will be inevitable and in 10 years time any reference to their being an exchange in Toronto or canadian control over securities issues in general will be history.
I'm just a layman observer and there will clearly be positives and negatives for various interests, but frankly you don't have to know the details of the deal. What is telling is that the head of the LSE was here in Toronto selling the deal on the day of the announcement. They were not in London selling the deal. You don't have to read the fine print to know what that means from a negotiation perspective. It means we have something they want to their advantage.
Also, if you do look at the deal more closely you will note that the clauses that retain some control in Toronto have time limits and are voided by further consolidations. I think such consolidations will be inevitable and in 10 years time any reference to their being an exchange in Toronto or canadian control over securities issues in general will be history.
brockm
Active Member
It always boggles my mind how people think about stuff like this. Even if we were to lose half of all the jobs to London, the net benefit to Toronto would still be positive.
Why? Because the capital pools of the exchange will make it the second biggest in the world. It will be easier for Canadian companies to raise money, because there will be a larger pool of investors, and easier access to capital means more business activity. And we're not even talking discretionary investment. We're talking large index and diversified funds for which larger pools of capital will be available.
The only thing we would lose is a symbolic claim that the TSX is Canadian owned. But that's just an emotional reaction. The truth is, Canada is arguably the most resource rich nation on the planet, and at the end of the day, you need investment to develop those resources. The idea that limiting the capital pool to Canada is better for Canadian jobs is nonsense, and plays to a horribly discredited and poor understanding of economics.
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NIL OMNI
Active Member
In the interests of accuracy, shouldn't the title of this thread be renamed to "Toronto and London Stock Exchanges to possibly merge" or that the merger is "proposed?"
Frankie1984
Active Member
So the Feds are in the process of reviewing it.
http://www.thestar.com/business/markets/article/938632--ottawa-to-review-tsx-merger-deal
But I read last week that Emperor Harper wasn't too keen on it so it might be all for not.
http://www.thestar.com/business/markets/article/938632--ottawa-to-review-tsx-merger-deal
But I read last week that Emperor Harper wasn't too keen on it so it might be all for not.
brockm
Active Member
What's funny is how bloody socialist Stephen Harper has turned out to be. His social views may be nominally conservative. And his foreign policy many be nominally conservative. But Harper has governed to the left of the Chretien Liberals economically. The Chretien government never blocked a foreign takeover. Harper has blocked two. Now he's gunning to block a third. All in less than 18 months!
Bogtrotter
Senior Member
I would agree, otherwise why have time limits? Do you think the Brits would agree to a LSE-TMX exchange with a majority TMX ownership? No way that would the Brits agree to majority ownership by a foreign company, I find it very unlikely they wouldn't agree to 50-50 either. Politics, nationalism and big business are inextricably linked. What I think most Canadians would like to know is what are the long term benefits to Canada of this takeover,and moreover what are the political implications of having market decisions made in a foreign country.
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js97
Senior Member
As reflected in the membership, it's generally a NDP based forum and Macro-economics is not as large of a concern as say, bike lanes and farmers markets?
It's interesting how centrist the Harper Government has become (benefits of a minority government!)
This will definately be a take-over instead of a merge. Perhaps the first few years, it will be played as a general 'merge, but it's only a matter of time until major functions become transfered to the LSE.
That being said, Toronto might receive many back office jobs due to costs etc.
I think the government needs to review the TSX/MSX merge and see where Montreal is right now in terms of 'net' benefit.
I think a good compromise would be to have the LSE/TMX under a regulatory body that is headed by the OSC/FSCO. The brits might have ownership and majority control, but play by Canadian Rules.
It's only a matter of time until the entire globe merges into one major economy/country.
It's going to be a tough one to measure out either way, but I 'HOPE' the Provincial and Federal govs dig in their heels and do something positive for the country, instead of making partisan decisions at each of their respective levels.
A merger this size, I can imagine the amount of off shore accounts being set up.
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AlvinofDiaspar
Moderator
js97:
Who appointed you as the spokesperson of UT? UT is first an foremost an urban issues (read projects-based) forum - the political inclination of its members has nothing to do with the relative lack of interest on the issue.
AoD
Who appointed you as the spokesperson of UT? UT is first an foremost an urban issues (read projects-based) forum - the political inclination of its members has nothing to do with the relative lack of interest on the issue.
AoD
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