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German exchange operator Deutsche Boerse AG (DB1.XE) Friday made a bid to acquire a majority stake in the Warsaw Stock Exchange, Deutsche Boerse's head of Eastern European business development told Dow Jones Newswires.
The Warsaw Stock Exchange, the largest of Eastern European exchange operators by trading volume and market value of listed companies, is an "attractive investment" given the opportunities offered by the Polish market, said Jochen Biedermann.
Biedermann said Deutsche Boerse was interested in acquiring between a stake of between 51% to around 74% in the Warsaw exchange from its majority shareholder, the Polish government. The value of the bid is in the millions of euros range, he said.
Deutsche Boerse's bid also includes suggestions for what a deal agreement could look like and potential future plans for the exchange operator, Biedermann said.
Cash and derivatives trading through the Polish exchange both look attractive, Biedermann said. "We also have our own ideas about new products," he added.
The Warsaw exchange is particularly attractive because of an anticipated row of privatizations that would increase the number of companies listed on the exchange. The Warsaw exchange has in recent years already seen a broad jump in the number of listings.
Merging the Warsaw exchange's cash-trading system onto Xetra's electronic trading platform would benefit Deutsche Boerse by giving it direct access to Polish traders and brokers, Biedermann said. "We're thinking about importing [the Xetra platform] but that must be agreed upon with market participants. Its not something we want to force," Biedermann said.
Aside from traditional stock exchanges, the Polish government also asked brokers to buy a minority stake in the exchange.
If a deal with Deutsche Boerse is successful, Polish market participants could win indirect influence in the Warsaw exchange's activities by holding various board seats, Biedermann said.
Polish market participants have said they want to maintain influence on the creation of new rules and products for the Warsaw exchange in the event of a takeover.
Deutsche Boerse's eye to the Polish trading market comes five years after Poland entered the European Union and ahead of its planned integration into the euro-zone economy.
The London Stock Exchange Group PLC (LSE.LN), NYSE Euronext (NYX) and Nasdaq OMX Group Inc. (NDAQ) were all originally invited to make bids for between 51% and 73.82% of the Warsaw Stock Exchange. The London Stock Exchange isn't expected to make an offer, however, a person familiar with the matter said last month.
-By Ruediger Schoss; Dow Jones Newswires; +49 69 29 725 515; firstname.lastname@example.org
(Marynia Kruk in Warsaw contributed to this article.)