Clayton Utz and Freehills have successfully negotiated the first hurdle in getting approval for the merger of the Australian Securities Exchange (ASX) and Singapore Exchange (SGX).
The Australian Competition and Consumer Commission (ACCC) announced yesterday (15 December) that it would not block the proposed acquisition of the ASX by the SGX.
"We were confident the whole way through that the ACCC would give approval, but this step would probably be the easiest of the various approvals that need to be made for the merger to go through," Clayton Utz corporate partner Karen Evans-Cullen said.
Clayton Utz was the Australian legal counsel to the SGX. In addition to Evans-Cullen, national M&A head Rod Halstead and Sydney-based trade practices and competition law partner Michael Corrigan led the firm's team. Allen & Gledhill are acting as the Singaporean adviser to the SGX.
Freehills acted for the ASX, with M&A, securities law and corporate partner Fiona Gardiner-Hill the main partner involved.
Despite representatives from both the SGX and the ASX wanting the merger to go ahead, Clayton Utz and Freehills made separate submissions to the ACCC.
"For the ACCC to oppose a merger, it must substantiate a lessening of competition that results from the proposed acquisition itself," ACCC chairman Graham Samuel said. "The ACCC found that the proposed acquisition was not the cause of the concerns about access."
For the merger to go ahead, both the Treasurer, Wayne Swan, and the Federal Parliament would need to give final approval.
Members of Parliament, such as Bob Katter and Bob Brown, have previously expressed concerns about the ASX moving offshore and Singapore's human rights record.
Evans-Cullen said that while public commentary on the matter raised the proposed deal's profile, it did not affect how Clayton Utz addressed regulatory or competition concerns in its submissions to the ACCC.
If the merger went ahead, it is highly likely the merged exchange would be based in Singapore, and would be named the SGX-ASX.
It would be the first merger between two market operators in the Asia-Pacific, and would seek to challenge the strength of regional exchange markets such as the Hong Kong Stock Exchange.
Evans-Cullen said that it is hoped the merged entity would be up and running by the middle of 2011.