Through The Fly's Eyes: Nasdaq, Borse Dubai

from Joseph Lazzaro of Theflyonthewall.com

Borse Dubai, Nasdaq Vie For OMX

Borse Dubai and Nasdaq are both bidding for the Nordic exchange owner, OMX, with the current bid, by Borse Dubai, up to $4 billion, according to the Daily Telegraph Dubai.

Further, there was talk that Nasdaq also may make a revised bid for OMX: according to one weekend press report, Nasdaq is planning to unveil an improved offer for OMX this week, Thomson Financial reported. In May, OMX agreed to a $3.7 billion offer from Nasdaq, but at lest two big shareholders are re-examining their support for the Nasdaq offer, Forbes reported.

Borse Dubai's $4 billion bid for OMX is becoming increasingly acceptable to institutional investors, after Sweden's regulator recognized the Dubai offer as legitimate, Gulfnews.com reported. About 25% of OMX floating stock is held by hedge funds.

London's Daily Telegraph also indicated that Nasdaq is also trying to sell its 31% stake in The London Stock Exchange, reportedly shopping its share for $1.6 billion.

The Dubai bid gives strong indications of Dubai's intentions to establish a Middle East / Europe multi-exchange capable of competing with Nasdaq and NYSE / Euronext (NYX), as well as major financial centers in Europe.

Analysts say the exchanges' efforts to establish regional partnerships and undertake mergers is being driven by technology, the increasing interconnectedness and interdependence of major equity and financial centers, and the benefits of economies of scale, among other factors. These analysts also generally note that Nasdaq's intention to sell its LSE stake represents a tactical modification, not a refutation of the regionalization of equity markets trend.