The proposed merger between Toronto’s TMX Group and London Stock Exchange would create the world’s largest resources-based exchange. The merged exchanges would also rank eighth in the world overall.
According to Bloomberg, LSE plans to issue stock for TMX using a ratio that is similar to the companies’ relative market values.
The LSE’s market capitalization is $3.89bn compared with TMX’s $3.01bn, giving LSE control of about 56% of the combined entity, according to data compiled by Bloomberg.
The merged Group would be co-headquartered in London and Toronto and continue to be overseen by its existing regulatory authorities.
But, LSE-TSX deal might face hurdles in Canada, where foreign takeovers of high-profile companies have become a sensitive political issue.
In recent years, a number of leading exchanges have merged.
The New York Stock Exchange has acquired Euronext, while Deutsche Borse bought the International Securities Exchange in the US. The LSE has itself bought Borsa Italiana.
