SGX ASX Merger

This has been all over the business news the last few days.

My simple, humble thoughts are as follows:

SGX is borrowing a hefty lot to make this bid ($4.9b) and paying a huge premium for a company that will lose it's monopoly next year.

But then without such an overvalued bid, we're going to see Australians burning the Singapore flag and using people power to stop the deal from going through. Granted, there's some noise right now but it's not as bad as if we made a lower bid and claim it to be overpaying.

Singaporean companies overpay for everything anyway don't we? It's the only way to seal a deal in the cleanest and least corrupted of fashions.

This is one up for all Singaporeans. Take that, you Aussie xenophobics!

Magnus Bocker doesn't normally announce deals without knowing the odds. And this time he still has probably calculated right. ASX wants this, the Aussie government (fragile as it may be) seems to be in support, and local protests are quite limited for now. Let's see how it pans out.

All in all not good if you're an SGX shareholder right now though, because SGX shares are headed for dilution if the deal goes through.

Yet I'm still feeling proud that we're the ones buying over them and not vice versa.