FT: LSE plan for TMX wins key backing

27 June 2011

11 Canadian financial services executives have thrown their weight behind the London Stock Exchange’s proposed merger with Canada's TMX Group, saying a rival offer from a consortium led by Canada's big banks would create a monopoly riddled with conflicts of interest.

In an open letter ahead of Thursday’s vote by TMX shareholders on the LSE deal, the executives said the rival group, Maple Acquisition, “would have significant control over virtually every aspect of access to financing in Canada. We believe this will negatively impact fees, enforcement, regulation, innovation and transparency”.

The signatories include Bill Holland, chairman of CI Financial, whose mutual funds are among TMX’s biggest shareholders. Others include a retired TMX chief executive and the heads of several independent brokerage firms, among them Tom Caldwell, a stock exchange investor.

The LSE deal requires approval from two-thirds of TMX shareholders on Thursday. Many have said they face the dilemma of choosing between the lesser of two evils.

Maple made a renewed pitch to investors on Monday to support its hostile C$3.8bn (US$3.8bn).

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