TMX Group, operator of the Toronto Stock Exchange, has announced that it will merge with the London Stock Exchange (LSE). The result would be a trans-Atlantic market with a dominant role in capital financing for the mining industry.
The spin off for Canadian investors is that the investing population of Britain—more than double that of Canada—would have easier, lower cost access to Canadian listings. That could mean a short-term bump-up in equity prices.
In terms of sheer number of listings, the combined exchange would be the largest in the world with more than 6,700 issuers, with a combined market cap of about $5.8 trillion.
The deal will require a slew of regulatory approvals, though. Not only will it face scrutiny by the Ontario Securities Commission, the Autorité des marchés financiers and Britain’s Financial Services Authority, but also Italian regulators, because the LSE owns the Milan bourse.
The post-merger company will be headed by Xavier Rolet, the CEO of the LSE. There will be a Canadian presence in the C-suite, however, as Michael Ptasznik will continue in his role as chief financial officer.
We will follow up with this story throughout the day.