The Nasdaq Stock Exchange (NDAQ) appears ready to dump its 31% holding in the London Stock Exchange and has hired JP Morgan (JPM) and UBS to find a buyer. According to MarketWatch, the NDAQ stake in London is worth about $1.56 billion. NDAQ would use about $1 billion of the proceeds "to retire senior-term debt and would use the remainder to repurchase shares."
The overseas retreat is beginning to look like a pattern at NDAQ. The US-base exchange though it had a lock on buying the Nordic exchange operator OMX . But Borse Dubai has topped that offer with a $4 billion one of its own. The new NDAQ deal to get into Europe is clearly in trouble.
Nasdaq tried its best to buy the London Stock Exchange, but the UK operator kept turning NDAQ down, and all that the US exchange had to show at the end of the day was a big piece of London that had no strategic value. Contrast that to the merger that created the two continent NYSE Euronext (NYX), and the Nasdaq attempts in Europe appear even more misguided.
The overseas missteps have cost investors something. NDAQ shares are down almost 5% over the last six months. And, all the exchange has to show for its efforts is a planned share buy-back.
Douglas A. McIntyre