TMX Maple deal hits snag in B.C.
Posted: Jul 5, 2012 8:36 AM PT
Last Updated: Jul 5, 2012 1:40 PM PT
The collection of banks trying to buy the company that owns Canada's largest stock exchange has hit an unexpected setback late in the process, as the B.C. regulator is voicing its opposition to the deal.
On Wednesday, Maple Group appeared to have cleared the final regulatory hurdles to its takeover of TMX Group, as the federal Competition Bureau and the Ontario Securities Commission both gave their approval to the deal.
But late in the day, the British Columbia Securities Commission unexpectedly filed a draft recognition order outlining a series of demands before signing off on the proposal. Commenting to CBC News on Thursday, a source inside the BCSC disputes the notion that the move is "late" in the process, noting it has been engaged with Maple Group since the start of the process and sent the latter a detailed list of their concerns dating back to December 2011.
According to a Bay Street source familiar with the process but who asked to remain nameless, the B.C. regulator is concerned that the deal would concentrate too much power in Toronto. Under the deal as it's currently constructed, 85 per cent of all stock and derivative trading in Canada would be controlled by Maple Group.
In a filing, the regulator said the deal as currently constructed would create "significant conflicts of interest, for anti-competitive behaviour, for inappropriate access to market information by Maple owners that is not available to competitors."
The regulator also fears there are risks related to smaller companies and pointed out that half of the companies that trade on the TSX Venture Exchange are based in B.C. As such, the regulator is demanding that 25 per cent of the members on Maple Group's board should have experience running small companies.
The regulator also wants to ensure that there's a commitment to keeping senior jobs in Vancouver.
"The lobbying pressure is so intense, from every level, so they will approve it," the source said. "But, they will try and get as much for themselves as possible."
The source also said that Alberta's regulator, which has also yet to sign off on the deal, will be watching current developments closely and will be likely to make similar demands.
In a statement to CBC News, Maple Group said they remain "optimistic" that the regulator's concerns can be addressed, and that the deal will proceed by the end of July.
TMX shares moved very little on the news, shedding 16 cents to $48.25. Maple's offer is for $50 a share.With files from Scott Peterson
Latest British Columbia News Headlines
- Teen's death sparks call for social services information
- The Alberta government wants to see changes on how provinces share information about children under the protection of social services. more »
- Christy Clark thanks Liberal MLAs in Vancouver
- B.C. Premier Christy Clark thanked her newly elected and re-elected MLAs in Vancouver on Thursday, who gathered for the first time following the Liberals' surprise victory in last week's provincial election. more »
- Pickup truck backs up over mother, 2 children in tent
- A 20-year-old woman has been arrested for allegedly backing her pickup truck over a mother and two children who were sleeping in a tent at a campsite in northeastern B.C. more »
- Fever medicine for infants, children under recall
- Quality concerns with a Chinese producer of acetaminophen have prompted a recall of four fever medications meant for infants and children. more »
Top News Headlines
- Toronto Mayor Rob Ford fires chief of staff
- A week after bombshell allegations that Toronto Mayor Rob ford was videotaped smoking crack, the mayor's chief of staff was fired and Ford is continuing to stonewall reporters. more »
- Federal Court won't remove MPs over robocall allegations
- The Federal Court says it won't throw six MPs out of their seats over allegations of widespread vote suppression through automated robocalls in the 2011 federal election. more »
- Alleged Ford crack video seller not responding to calls
- The journalist who broke the story alleging Toronto Mayor Rob Ford was recorded on video smoking crack cocaine says he may never be able to get his hands on the evidence. more »
- Bridge collapse on Washington interstate drops cars into water
- The Washington State Patrol says the Interstate 5 bridge over the Skagit River at Mount Vernon has collapsed, dumping vehicles and people into the water. more »
- Vancouver man abandons Porsche on B.C. ferry
- B.C. teen saves pet dog in 'terrifying' cougar attack
- 750 homes sliding away in Quesnel, B.C.
- Flood watch underway in central B.C. Interior
- Plumber's car explodes near Vancouver apartments
- Christy Clark thanks Liberal MLAs in Vancouver
- Men found dead in B.C. lake wore oversized life-jackets
- New West parkade a blight on revitalized waterfront
- Johnsons Landing homes must be abandoned, says report