Australia intends to reject Singapore Exchange Ltd's proposed $7.8 billion bid for Australia's ASX Ltd on national interest grounds, underscoring the political challenges facing other cross-border exchange deals. The two exchange operators wanted to team up to cut costs, fight growing pressure from alternative trading platforms and avoid being left behind as rivals in North America and Europe get together.
But Australian Treasurer Wayne Swan, facing growing political opposition to the deal, said on Tuesday he intended to reject the bid after getting advice from the country's Foreign Investment Review Board. A final decision had not been made, he added, but share moves showed the market doubted the deal could be saved. ASX shares closed down 3.3 percent, while SGX shares rose more than 6 percent before closing 4.5 percent higher.
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