TOKYO, Aug 23 (Reuters) - The Tokyo Stock Exchange said on Thursday it acquired a two-thirds stake in the Osaka Securities Exchange for $1.1 billion in a public tender offering, paving the way for a combination to create a dominant equities bourse in Japan.
The Tokyo Stock Exchange (TSE) said in a statement that 80 percent of all outstanding shares in the Osaka Securities Exchange (OSE) were tendered in the offering, above the two-thirds upper limit of what the TSE said it would purchase.
The tender offer was launched on July 11 and closed on Wednesday.
The result makes it all but certain that the TSE will be able to succeed at the next stage of the takeover process, an extraordinary meeting of OSE shareholders in the coming months where the merger itself must be approved by two-thirds of the vote.
Unveiled in November, the merger has been billed as a way to combine the strengths of the TSE in cash equities, a market segment it dominates with more than 90 percent of volumes, and the OSE’s stronghold in Nikkei futures and other derivatives.
But the outcome had been clouded somewhat by the opposition of some overseas funds who believed the TSE should be paying a higher premium than the per share tender offer price of 480,000 yen, which values the OSE at 130 billion yen.
OSE shares closed at 437,500 yen on Thursday.
Fidelity, which owns 15 percent of the OSE, making it the largest shareholder, had been leaning towards not tendering its shares at that price, according to sources with knowledge of the global fund giant’s thinking.
The combined value of domestic stocks listed on the TSE and OSE, at $3.5 trillion, would trail only NYSE Euronext (US) at $13.2 trillion and Nasdaq OMX Group Inc’s $4.5 trillion, figures for July from the World Federation of Exchanges show.
If OSE shareholders approve the merger, the combined firm, to be called the Japan Exchange Group, will be established in January 2013.