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Dubai: The bidding battle for OMX reached a crucial phase yesterday as Borse Dubai filed its formal offer with the Swedish Financial Supervisory Authority and analysts said that there is no reason to believe the regulator will reject Dubai's offer.
Borse Dubai made a $4 billion all-cash bid for OMX on August 17 at 230 Swedish crowns per share against Nasdaq's $3.7 billion cash and share offer. Prior to the full offer, the Dubai firm announced the acquisition of 4.9 a per cent stake in OMX and further options to acquire an additional 23.5 per cent.
Following a preliminary investigation into the Borse Dubai offer, the Swedish market regulator (Finansinspektionen) accepted the Dubai offer as legitimate, although it said that the Dubai firm should have announced a takeover bid when it announced the initial acquisition.
Borse Dubai has appealed against that ruling. Last week Per Larsson, chief executive of Borse Dubai, told Gulf News that he is very positive about the official reactions in Sweden to the Borse Dubai offer.
Meanwhile analysts and merger and acquistion experts said there are valid reasons to say that any bidder is qualitatively better than another.
Nasdaq's offer awaited
"All these arguments about convincing the regulator that Borse Dubai is 'fit and proper' is a bit far fetched as the entire process has been transparent and the Dubai firm is an entity that operates in a world-class regulatory environment," said a DIFC-based investment banker.
Borse Dubai could launch its public offer early next month once its documents are approved.
A quick decision is likely in this case as all parties are keen to move ahead with the bidding process as early as possible.
Despite a competitive bid from Borse Dubai, Nasdaq has yet to improve its earlier offer. On the contrary, it insists that its cash and share offer combined with the synergies make it superior to the Dubai offer.
Dubai's all cash offer is 13 per cent higher than the US-based Nasdaq's cash-and-share offer of 202.3 crowns ($28.89) per share as on August 17.
The Dubai offer also represents a 38.6 per cent premium to 165.9 crowns per share - the volume weighted average price of OMX shares over the 20 trading days up to and including last May 23, the last full trading day prior to the announcement of Nasdaq's offer.
With the regulatory clearance for Borse Dubai almost certain, all eyes are now focused on Nasdaq's offer. "With strong presence of institutions and hedge funds among investors, price will be the most decisive factor that will swing the deal," said an analyst.
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