Tokyo exchange in discussions with SGX

(SINGAPORE) The Tokyo Stock Exchange (TSE) yesterday said that it is in talks with the Singapore Exchange (SGX) on collaboration in the future.



Mr Pillay: 'Here in Asia there are still restrictions on what can be done. That doesn't mean there won't be some M&A activity but it will be fairly limited and modest.'
Masaki Suzuki, general manager of TSE's representative office in Singapore, declined to comment on its discussions with the exchange.

Mr Suzuki told BT that there is no time frame within which the TSE intends to increase its stake, although he stressed that TSE does not intend to hold more than 5 per cent, up from the current 4.99 per cent.

JY Pillay who was appointed as non-executive chairman of SGX yesterday at its annual general meeting said the exchange is 'always looking' at alliances and joint ventures to grow and develop itself and the capital market in Singapore.

'That is our prime concern. M&A (mergers and acquisition) activity is purely a means to that end.'

SGX's share price has rocketed on takeover talk. Since news of the deal struck between Nasdaq and Dubai's stock exchanges broke last week, SGX shares have surged 23 per cent to hit $13.80 on Wednesday.

It fell 3 per cent to close at $12.90 yesterday.

On the share price spike, Mr Pillay said that there is an 'M&A buzz all over the world' particularly in the West where the markets are more open.

However, he expressed doubt that the wave of acquisitions among exchanges in Europe could be replicated in other parts of the world.

'Here in Asia there are still restrictions on what can be done,' Mr Pillay said.

'That doesn't mean there won't be some M&A activity but it will be fairly limited and modest.'

With chief executive Hsieh Fu Hua due to step down in September 2009, Mr Pillay said that SGX will have to start to seriously think about a replacement in a year's time.

'I would say we always have a little shortlist of our own. But we'll have to start pursuing the matter very vigorously from the middle of next year.'

Mr Hsieh was paid $6.4 million in FY07, including a bonus of $4.5 million and long-term incentive of $1 million. Last year, he got $4.3 million, including a bonus of $2.75 million.

For the first time, SGX disclosed total remuneration paid to its five top-earning executives, including head of markets Gan Seow Ann and chief financial officer Seck Wai Kwong who got about $2 million each.

SGX said that total remuneration to directors in FY07 was $10.4 million, up from $6.7 million the previous year.

Including total remuneration to key management, the figure was $20.7 million, up from $12.5 million in FY06.

Although no share options were granted to key management, 1.7 million shares under a performance share plan were granted.

SGX reported a 125 per cent rise in net profit for FY07 of $422 million, including the write-back and gains on SGX Centre.