Borse Dubai Trumps Nasdaq's OMX Bid

Borse Dubai, which owns both of the emirate's stock exchanges, said Friday it made an unsolicited 27.7 billion kronor (230 kronor/share -- $3.96 billion, $32.81/share) cash offer for Sweden's OMX AB exchange, trumping a 202.3 kronor/share cash-and-stock bid it excepted from Nasdaq Stock Market Inc. in May by 14%. Dubai is using billions of dollars of oil revenue to invest in financial services and lure companies to the area. Borse Dubai is a new holding company set up by the government to carry its stakes in the two exchanges. Acquiring OMX, it said, will give investors "access to one of the largest liquidity pools in the world" and create the world's fifth largest stock exchange. Nasdaq gave up on its aspirations to acquire the London Stock Exchange amid opposition from the LSE's shareholders and board, and CEO Robert Greifeld has since turned his attention to the OMX, hoping to gain a foothold in European markets and acquire OMX's exchange-running software. Its software runs the Hong Kong, Singapore and ISE exchanges. Nasdaq's May 25 offer consists of 94.3 kronor/share cash and 0.502 of its shares for each OMX share. Under the terms of their agreement, OMX is not permitted to actively seek other offers, but is required to evaluate any bids that it receives. Borse Dubai said it bought a 4.9% stake in OMX on Aug. 9, and has entered into option agreements to purchase another 23.5%. In a statement Friday morning, the Nasdaq said it remains 'fully committed' to its offer, which, it said, "provides superior long-term value [and] will strengthen the Nordic region." In an Aug. 9 interview, Greifeld said Nasdaq could be "flexible with regard to the structure of the offer. We certainly have the financial wherewithal to consider other alternatives."

Sources: Nasdaq statement, Wall Street Journal, Bloomberg
Commentary: Nasdaq -OMX Merger Threatened by DIFC - Report • The Nasdaq Is a Buy on Valuation and Growth Catalysts
Stocks/ETFs to watch: NDAQ. Competitors: NYX, CME, ISE, ICE

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