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NEW YORK/TORONTO (Reuters) - TMX Group Inc (X.TO) faces a giant hurdle to win over shareholders ahead of a vote on London Stock Exchange's (LSE.L) $3 billion (1 billion pounds) bid for Canada's market operator, the head of Toronto Dominion Bank (TD.TO) said on Friday.
TD Chief Executive Ed Clark, who is part of the so-called Maple Group consortium of nine Canadian banks and pension funds that is pitching a rival bid to shareholders, said it was unfortunate that TMX and LSE had set a June 30 vote date for shareholders -- well before federal and provincial regulators are likely to rule on the deal.
"They're months away from knowing whether or not this deal is approved," Clark told Reuters in an interview, adding that Toronto Stock Exchange parent TMX has a lot of potential and should not "sell out" to a foreign entity.
"I think they have an extremely high hurdle. They've got to get two-thirds of the votes. And they should look around and see who actually has the shares," he said in New York.
Maple members own a significant chunk of TMX's shares, according to Thomson Reuters data.
Should the C$3.6 billion ($3.7 billion) Maple deal go through, Clark said the consortium would consider joint ventures or acquisitions in the future with exchanges in other countries who share the same business strategy as TMX.
Earlier on Friday, LSE and TMX said Canadian competition authorities will not challenge the proposed combination of the two exchange operators, as expected.
The Competition Bureau's decision will be crucial to Maple Group's proposition, however, since the bid would also involve approval of the acquisition of Alpha Group , the Toronto Stock Exchange and the TSX Venture Exchange's main competitor in equity trading.
TMX and LSE's biggest regulatory hurdles will come from provincial regulators and in particular, Industry Canada, which will decide under the Investment Canada Act whether the deal is of net benefit to the country.
Reporting by Jonathan Spicer and Solarina Ho; additional reporting by Paritosh Bansal in New York, editing by Gerald E. McCormick