SGX among contenders said to be eyeing Tel Aviv Stock Exchange

A pedestrian walking in front of a Singapore Exchange logo outside its building along Shenton Way.
A pedestrian walking in front of a Singapore Exchange logo outside its building along Shenton Way.PHOTO: THE NEW PAPER

SINGAPORE - The Singapore Exchange (SGX) has emerged as one of the contenders for a controlling stake in the Tel Aviv Stock Exchange (TASE), according to Israeli media reports.

More than 10 foreign stock exchanges have expressed interest in buying into the exchange by signing nondisclosure agreements, Reuters reported late Tuesday (Feb 27), citing a source close to the TASE.

Israeli media said these included exchanges in London, Toronto, Hong Kong, Singapore, Australia and Warsaw.

In January, the TASE said that it was in the process of finding a strategic investor, with shareholders putting up for sale a 71.7 per cent stake in the exchange.

This stake is valued at around US$147 million and the deadline for suggesting an interested buyer is April, according to technology news site CTech.

The TASE has said that it expects to draw interest from the world's leading stock exchanges, "which will significantly strengthen the Israeli stock exchange's competitive position globally and will lead to the creation of international collaborations and attract overseas investors".

The bourse operator said in January: "This measure fits in well with ...the global trend whereby major stock exchanges hold shares in a number of small and medium-sized stock exchanges, enabling them to benefit from greater exposure, cooperation and advantages of scale." The search for a strategic investor comes as the TASE has seen a slump in trading volumes and around 200 de-listings over the past decade, Reuters said.

In September last year, the TASE began a demutualisation process. The ownership restructuring will allow it to distribute its earnings and even issue shares in public offerings.

Member banks will retain a 22 per cent stake in the TASE while TASE employees own another 6 per cent, Reuters said.

When queried by The Business Times, an SGX spokesman said: "SGX does not comment on market rumours. We are focused on our initiatives to build and diversify our multi-asset exchange business, with the aim of adding value to our stakeholders. "We remain open to opportunities that align with our strategy and will keep the market informed if any material development arises." Israeli firms listed on the SGX include Sarine Technologies, a diamond specialist technology firm, and tech incubator Trendlines.

SGX shares fell 10 cents or 1.31 per cent to S$7.55 on Wednesday.