TMX-LSE merger cancelled, Bay Street bankers rejoice

From Globe and Mail:

The proposed merger of the TMX Group Inc. with the London Stock Exchange Group PLC has been terminated.

The merger requires support of two-thirds of TMX shareholders who are scheduled to vote on the deal Thursday at a meeting in Toronto. However, sources familiar with the merger confirmed that only 54 per cent of shareholders who have already voted by proxy have approved the merger. Roughly 70 per cent of shareholders voted by proxy.

With those kinds of margins, it looks highly unlikely that the pro-merger side can win, so the Toronto-London deal is off. At first, it appeared the major voices of discontent would come from government regulators concerned about the loss of Canadian jobs. But it turns out the real detractors were many of the Bay Street elite. As Toronto Life columnist Tony Keller noted in the pages of our June issue, despite coming out of the recession in solid shape, the Canadian exchange would have been the junior partner in this deal, and that didn’t sit well with the titans of Toronto finance.

There have been other mergers proposed (although with Canadian companies), and in theory, it’s possible that the Londoners could try again with a sweeter offer. But given the rocky ride LSE had on this deal, we’d be surprised if they tried for a second bite at the apple.

• TMX-LSE deal terminated [Globe and Mail]