May 13, 2011 / 2:04 PM / 7 years ago

TMX files with regulators on LSE deal

TORONTO (Reuters) - TMX Group (X.TO), the operator of the Toronto Stock Exchange, on Friday reported a 13 percent rise in quarterly profit and said it filed applications with Canadian provincial regulators for approval of its $3 billion (1.85 billion pound) tie-up with the London Stock Exchange (LSE.L).

The two exchanges filed with securities commissions in Ontario, Quebec, Alberta and British Columbia. Last month, TMX and LSE filed its application with the federal government under the Investment Canada Act.

First-quarter net income rose to C$64.3 million (41 million pounds), or 84 Canadian cents a share, up from C$56.7 million, or 77 Canadian cents, a year earlier, helped by higher revenue and trading volumes.

On an adjusted basis, TMX earned 97 Canadian cents a share, compared with 77 Canadian cents a share, a year earlier.

Revenue for TMX, which also operates the TSX Venture Exchange for small-capitalisation companies and the Montreal Exchange derivatives market, rose 17 percent to C$174.7 million.

Total financing for the TSX rose 18 percent from the first three months in 2010, and 97 percent for the TSX Venture Exchange. Trading volumes also rose 20 percent on the TSX and 64 percent on the Venture Exchange.

All told, there were 91 new listings in the first three months of 2011, including 67 initial public offerings.

For the quarter, the company said merger related costs during the first quarter was C$8.3 million.

“We have made this investment because we are convinced this merger represents an unparalleled opportunity for our company,” Chief Executive Tom Kloet told analysts in a conference call, adding that the company was in the advanced stages of planning its merger special meeting.

“This is not a deal we have to do. It is a deal we want to do,” said Kloet who declined to comment on media reports that Canadian banks opposing the deal could make a rival approach.

Additional reporting by Bhaswati Mukhopadhyay in Bangalore

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