Nasdaq OMX Group Inc. (NDAQ) doesn't expect that Borse Dubai Ltd. will be pressured to sell its stake in the exchange operator as some market participants have feared in recent days, the president of Nasdaq OMX Nordic told Dow Jones Newswires Wednesday.
"It's not a factor," Hans-Ole Jochumsen said in an interview on the sidelines of an industry conference in Brussels.
Jochumsen said Nasdaq OMX's share price had rebounded in recent days following a sell-off prompted by fears that Borse Dubai would sell its 28% stake in Nasdaq OMX, as the emirate of Dubai seeks a stay on Dubai World's debt obligations.
Borse Dubai became the biggest shareholder in Nasdaq OMX following Nasdaq's acquisition of Nordic exchange group OMX in early 2008. That deal saw Borse Dubai buy into OMX ahead of Nasdaq's planned purchase, eventually acquiring OMX outright and selling it to Nasdaq OMX in return for a 28% stake in the combined exchange company.
Dubai roiled global markets last week when the formerly high-flying emirate announced that its main development company, Dubai World, needed a six-month standstill on paying back $60 billion in debt, while it restructures its Nakheel World and Limitless World units.
Borse Dubai, created in 2007 to consolidate the emirate's interest in its nascent financial exchange business, is separate from Dubai World.
Borse Dubai holds 20% of Nasdaq OMX shares directly, with an additional 8% held in a blind trust; it also owns 20% of the London Stock Exchange, shares, which also came under pressure following the Dubai World announcement.
Though there is no direct link between the troubled Dubai World and Borse Dubai, Citi Investment Research analyst Donald Fandetti said the emirate's struggles have raised questions around all of its liquid investments.
"When Dubai made these investments, part of it was to diversify, and the other part was to become a more prominent financial hub," Fandetti said. "You wonder what this crisis does to that aspiration...good assets can be sold when there are capital calls."
Jochumsen also said Nasdaq OMX hoped to launch a multilateral trading facility in the Baltic region, where it last month boosted its stakeholdings in several exchanges with the aim of introducing a single trading currency across the markets.
By introducing a single trading currency on exchanges in Estonia, Latvia and Lithuania, Nasdaq OMX hopes to avoid risks related to currency fluctuation and create a bigger liquidity pool, Jochumsen said. "Our intention is to make sure that there is a well-functioning market" in the region, he said.
In the U.K., Nasdaq OMX plans to introduce power derivatives trading on its nascent N2EX market around the end of the first quarter or the second quarter of 2010, after introducing spot trading on Jan. 11.
"The first step is to create a physical market," Jochumsen said. "In three to five years we should have a very interesting perspective" for the segment.END
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