Maple Group Acquisition Corp. says it is yet again extending the deadline for its $3.8-billion takeover proposal for TMX Group Inc. (TSX:X) as it awaits regulatory approval.
The consortium of 13 Canadian banks and pension funds said Friday the deadline to acquire a minimum of 70% of TMX shares has been extended until Apr. 30, unless it is further extended or withdrawn. The bid has already been through several extensions, the most recent expiring Friday.
Given the current status of the regulatory process, it will not be able to complete the deal by Apr. 30, the original slated closing date under agreements with the TMX Group and Maple investors, the group said.
The parties are in talks to extend that date, but there is no assurance it will happen, Maple said.
The TMX Group runs the Toronto Stock Exchange and TSX Venture exchange as well as energy trading and other businesses.
Maple needs regulatory approvals to merge TMX with the alternative Alpha Trading System, and clearing and depository firm CDS Inc. Alpha and CDS are owned by the major players in the Canadian securities industry, several of which are part of the consortium.
Securities regulators in Quebec and Ontario indicated earlier this month they were moving closer to approving the offer.
The Autorite des marches financiers said it intends to approve the transaction while the Ontario Securities Commission has instructed its staff to develop draft recognition orders with detailed terms and conditions. Those draft orders will be subject to a 30-day public comment period prior to a final decision.
However, the federal Competition Bureau remains the big hurdle for the takeover deal and it has signalled it would need to see “a significant and material change to the competitive consequences” of the proposed deal to address its serious concerns.
The deal also requires approval of regulators in Alberta and British Columbia.
“Maple will work to settle the terms and conditions of the recognition orders and to resolve outstanding issues and concerns raised by the securities regulatory authorities and the Competition Bureau,” the group said in a statement.
“However, there can be no assurance that the terms and conditions of the recognition orders will … address the issues and concerns raised by the securities regulatory authorities and the Commissioner of Competition. As a result, there can be no assurance that the required regulatory approvals will be obtained.”
The Maple investors are also in active negotiations among with Alpha and the Canadian Depository for Securities Ltd. and their shareholders regarding the price and terms of those acquisitions.
Maple had originally aimed to have definitive agreements for those takeovers prior to the closing of the TMX deal.
Maple said it will review and assess the progress of discussions with securities regulators and the Competition Bureau, Alpha, CDS and their investors and “other circumstances affecting the Maple transaction” while considering any further extensions.
It plans to extend the offer on or before Apr. 30 if it is satisfied after that review.
Maple continues to commit not to allow any person or company to acquire more than 10% of its voting shares without prior approval of the regulator.
TMX Group’s board originally supported a merger proposal with the London Stock Exchange Group and dismissed the Maple Group offer over a number of debt, competition and regulatory concerns.
But after the LSE deal failed to gain enough shareholder support in the face of the richer Maple bid this summer, the board turned its attention to the Maple offer.