STOCKHOLM, Sweden, (AP) – Nasdaq Stock Market Inc. and Borse Dubai have reached a deal under which Nasdaq will take over Nordic bourse operator OMX AB, while Borse Dubai acquires just under 20 percent of Nasdaq and 28 percent of the London stock exchange.
The deal announced Thursday would resolve a takeover battle between Nasdaq and Borse Dubai for Stockholm-based OMX. It is subject to approval by shareholders and regulators in Europe and the United States.
Under the deal, Borse Dubai will go ahead with its $4 billion cash bid for OMX, but sell all shares in the Stockholm-based company to Nasdaq. In exchange, Nasdaq will pay Dubai 11.4 billion kronor ($1.72 billion) in cash and give it a 19.99 percent stake in Nasdaq, the companies said.
In addition, Dubai would acquire a 28 percent stake in the London Stock Exchange from Nasdaq for 1,414 pence ($28.38) per share.
“Taken together, these strategic actions will provide us with a footprint unlike any other exchange, creating a global exchange leader, with operations in key markets around the world,” Nasdaq Chief Executive Bob Greifeld said in a statement.
The deal would help Nasdaq avoid a bidding war with cash-rich Borse Dubai for OMX, while Dubai gains footholds in both Nasdaq and the London exchange.
“By entering into this partnership with Nasdaq, we will benefit from Nasdaq’s world-leading brand, technology and platform,” Borse Dubai Chairman Essa Kazim said. “In addition, this combination will establish a gateway to large pools of liquidity.”
Nasdaq in May presented a $3.7 billion cash-and-share offer for OMX, which was supported by both boards and key OMX shareholders. Borse Dubai launched its challenge on Aug. 17 with an unsolicited $4 billion cash bid for OMX.
The competing offers led to speculation that Nasdaq would be forced to raise its bid, or find some other form of arrangement with Dubai, involving Nasdaq’s stake in the London Stock Exchange.
Nasdaq has previously tried to acquire the U.K. market, but said last month it would sell its 31 percent stake to focus on the takeover battle for OMX.
Nasdaq said Thursday it would sell 28 percent to Borse Dubai to pay down about $1 billion in debt and initiate a stock buyback. It was not immediately clear what Nasdaq would do with the remaining 3 percent of the London exchange.