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Maple Group Acquisition Corporation (Maple) and TMX GroupInc. (TMX Group) announced that they received today the Commissioner of Competition's currentviews with respect to Maple's proposed acquisitions of TMX Group, CDS and Alpha Group (proposed transactions). As previously disclosed, approval by the Commissioner of the proposed transactions is a condition to the completion of Maple's offer to acquire TMX Group.
The Commissioner advised Maple and TMX Group that she has serious concerns about the likely competitive effects of the proposed transactions in the current environment, primarily in connection with equities trading and clearing and settlement services in Canada.
The Commissioner indicated that she has not reached a final conclusion and that her current views may be affected by further factual information and developments, which may include changes in the applicable securities regulatory regime, and any commitments or other remedial measures that Maple may be prepared to take to address her concerns.
Maple and TMX Group intend to continue to work closely with staff of the Competition Bureau to address the Commissioner's concerns, including by identifying appropriate remedial measures. As Maple has stated previously, it is committed to working constructively with all of the relevant regulators, including Canadian securities regulators, to address any questions they may have so that the proposed transactions can proceed in the best interests of TMX Group, its shareholders and the Canadian capital markets. Maple and TMX Group continue to strongly believe that the proposed transactions will substantially benefit all capital market participants.
Under the Support Agreement entered into between Maple and TMX Group, Maple has agreed to use commercially reasonable efforts to obtain all required regulatory approvals, including from the Commissioner, and to accept all conditions, commitments and undertakings necessary to do so, provided they do not result in a “Material Detriment” as defined in the Support Agreement. There can be no assurance that remedies short of a Material Detriment will address the Commissioner’s concerns.
If regulatory approvals are not obtained by January 31, 2012 (the current expiry date of the Maple offer), Maple is required subject to certain exceptions to extend the expiry date until April 30, 2012, as necessary to obtain the required regulatory approvals.
At this time, Maple and TMX Group do not plan to comment further. Maple and TMX Group will appear on December 1, 2011 at the public hearing convened by the Ontario Securities Commissionregarding the proposed transactions.
