Nasdaq OMX Bid Aided by Swedish Politics

Swedish politics could be a deciding factor in who wins the battle to buyout Nordic exchange operator OMX AB. Nasdaq submitted a $3.7 billion offer in stock and cash for the OMX on May 25, but was outbid by government-owned Borse Dubai who offered $4 billion in cash. However, both the Swedish government and the OMX board are not sold on Borse Dubai's seemingly superior bid. The Swedish government is selling its 6.4% stake in OMX to reduce State ownership, but ruling coalition Moderate party member Bertil Kjellberg saw a deal with Borse Dubai as replacing "a state owner with a state owner." Karin Pilsater, chairman of the Swedish parliamentary committee on industry and trade, further added Dubai's "type of government is, to put it mildly, different" than Sweden's. OMX Chairman Urban Backstrom said that he did not consider the Borse Dubai bid superior to Nasdaq's. He explained the industrial synergies in a deal with Nasdaq were greater than Borse Dubai's. He added "I could never have realized then that another state, a sovereign state, would put a bid in (for) the company." The Nasdaq on Monday also said that it may sell its 31% stake in the London Stock Group (see full summary), encouraging expectations that it is preparing to increase its offer on OMX. Bob Greifeld is expected to travel Sweden this week to speak with OMX stakeholders as well.

Sources: Dow Jones, Reuters
Commentary: Nasdaq Puts LSE Stake on the Block • Borse Dubai Trumps Nasdaq's OMX Bid • The Nasdaq Is a Buy on Valuation and Growth Catalysts
Stocks/ETFs to watch: NDAQ. Competitors: CME, BOT, ICE, ISE, NYX
Earnings call transcript: The Nasdaq Stock Market

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