Singapore Exchange offers $8.2 billion for Australian Securities Exchange

Singapore Exchange Limited (SGX) today revealed plans to acquire Australian Securities Exchange Ltd (ASX), for $8.2 billion in a cash and stock transaction in order to create Asia Pacific's pre-eminent exchange group.

SGX will offer A$22.00 (S$28.04) in cash and 3.473 new ordinary SGX shares for each existing ASX ordinary share, a premium of 37.3 per cent to the last traded price of ASX shares on 22 October 2010, valuing the Australian bourse operator at A$48.00 per share or S$10.7 billion (A$8.4 billion.

SGX, Asia-Pacific's first demutualised and integrated securities and derivatives exchange and ASX were last week reported to be in merger talks, which if successful, would create one of the region's largest bourses with a market value of approximately $ $13.9 billion. (See: Singapore, Australian Stock Exchanges in merger talks)

A new holding company would be formed called ASX-SGX Limited and will be listed on both the Singaporean and Australian exchanges.

The combined group will continue to operate out of Australia and Singapore, maintain their existing brands and will remain as separate legal and locally regulated entities.

Magnus Böcker, currently the CEO of SGX, is expected to become the CEO of the combined group, while David Gonski, currently the chairman of ASX, will become the deputy chairman and Peter Hiom, the current deputy CEO of ASX, will become the CEO of the ASX business of the combined group.