Magnus Bocker, who stitched together eight European stock exchanges and sold them in a bidding war, is running into a wall with shareholders and politicians over his plan to acquire Australia’s main bourse.
Singapore Exchange Ltd posted its worst two-day drop in two years after Chief Executive Officer Bocker unveiled an $8 billion takeover of ASX Ltd this week. Australian Green party leader Bob Brown said he won’t support the bid and Tokyo Stock Exchange Group Inc, with a 5 per cent stake in its Singapore rival, warned it will be saddled with losses.
For the 49-year-old marathoner, winning in Asia may prove harder than in Europe, where he combined companies from Lithuania to Iceland to create the region’s fifth-largest exchange. JPMorgan Chase & Co, Credit Suisse Group and Deutsche Bank cut ratings on Singapore Exchange yesterday, citing regulation, debt and ASX’s growth outlook.
“There are doubts that the transaction will push through,” said Pearlyn Wong, an investment analyst in Singapore at Bank Julius Baer, which manages about $262 billion in client assets worldwide. “SGX is paying a steep premium for ASX and it’s highly questionable if the synergies from this acquisition will materialise.”
Less than a year after becoming chief executive officer of Singapore Exchange, Bocker unveiled the first cross-border merger of bourses in the Asia-Pacific region, a plan that would create the world’s fifth-largest market operator by share value.
