Singapore Exchange drops ASX bid

City A.M. Reporter
Singapore Exchange terminated its $8bn (£4.9bn) bid for Australia's ASX after the Australian government formally rejected the offer, saying changes to the country's financial systems were needed before foreigners could buy the bourse.

It was the first time the Australian government has rejected a major foreign takeover on national interest grounds since 2001 when Royal Dutch Shell's bid for Woodside Petroleum was blocked.

Australian Treasurer Wayne Swan said the deal would have diminished Australia's economic and regulatory sovereignty, presented material risks and supervisory issues due to ASX's dominance over clearing and settlement and failed to boost access to capital for Australian businesses.

"It's not the right deal for Australia if we want to enhance our links into global capital markets.

It's not the right deal for Australia if we want to grow our role as a financial services hub in Asia," Swan told reporters on Friday.

Swan said he would not oppose future deals if they protected Australia's financial architecture, enhanced the country's standing as a financial services centre in Asia, boosted access to capital for Australian businesses and supported growth in high-quality financial services jobs.