OSAKA (Kyodo) The March 11 disaster has delayed the start of merger talks between Tokyo Stock Exchange Group Inc. and Osaka Securities Exchange Co.

The heads of the two bourses revealed separately on March 10, the day before the quake-tsunami disaster, that they were mulling integration, but they could not arrange direct talks in March as initially intended, sources said Thursday.

The delay has been caused as politicians and government financial regulators are focusing on the immediate challenge of addressing the impact of the disaster as well as the subsequent nuclear crisis, they said.

In addition, the two bourses have not reconciled their difference over whether the merger should precede the TSE’s planned stock listing, expected this fall or later, they said.

The TSE has said any merger should come after the listing, while OSE President Michio Yoneda has said the merger agreement should be concluded within three months.

As its shares have already been listed, the Osaka bourse is finding it easier to make preparations for a merger, such as calculating its corporate value, and is seeking to be the surviving company if the integration takes place.

But an executive of a securities company said, “The TSE will not accept such a deal” in which a smaller entity absorbs a bigger one.

“Securities companies which currently own TSE shares would demand that OSE pay a considerable price for the shares if it swallows up TSE,” the executive said. TSE shares were allocated to around 100 brokerages when it was a membership organization.

Many of these securities companies are keen to cash in on capital gains on their shareholdings when the TSE goes public.

Extension delayed

Kyodo News

The operator of the Tokyo Stock Exchange said Friday that it will put off until this autumn extending its morning trading hours by 30 minutes, to help cope with severe power supply shortages expected in and around the capital this summer.

The TSE had planned to extend from May 9 the current morning trading hours of 9 a.m. to 11 a.m. to between 9 a.m. and 11:30 a.m., giving market participants more time to trade and spur overall activity on the bourse. No changes are planned for the current afternoon trading hours of between 12:30 p.m. and 3 p.m.

Osaka-Bombay tieup

OSAKA (Kyodo) The Osaka Securities Exchange said Thursday it has signed a memorandum of understanding with the Bombay Stock Exchange to seek mutual cooperation in such areas as cross-licensing of indexes.

Under the deal, the two bourses are expected to develop financial products linked to their stock indexes and list them at each other’s markets.

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