Taiwan exchange aims alliances and no M&A plans

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A man walks past a full green board signifying a mass drop in Taiwan stocks inside a brokerage in Taipei May 21, 2010. REUTERS/Nicky Loh

By Shao Xiaoyi and Farah Master

BOAO, China | Sat Apr 16, 2011 7:34am EDT

(Reuters) - The Taiwan Stock Exchange aims to boost its alliances with other bourses in Asia by way of exchange-traded funds (ETFs) and has no plans for mergers and acquisitions, its chairman said on Saturday.

"The global wave of exchange mergers has got nothing to do with us. So far, we don't really have the relevant regulations to allow that," Schive Chi, chairman of the exchange, told Reuters on the sidelines of the Boao Forum in China's southern province of Hainan.

The Taiwan bourse, located in the landmark Taipei 101, is open to discussions with counterparts in Shanghai and Tokyo on cross-listings of ETFs, investment funds that are traded on stock exchanges, Schive said.

Exchanges around the world are chasing cross-border deals to build scale and cut costs as competition increases from dark pools, though not all have met with success.

Singapore's stock exchange (SGXL.SI) came close to buying Australia's ASX Ltd. (ASX.AX), but the Australian government rejected the $8 billion bid.

The Tokyo and Osaka exchanges are in talks; Deutsche Boerse (DB1Gn.DE) is competing with a partnership of Nasdaq OMX Group (NDAQ.O) and IntercontinentalExchange (ICE.N) to buy NYSE Euronext (NYX.N); and London Stock Exchange (LSE.L) is looking to combine with Canada's TMX Group (X.TO).

In southeast Asia, exchanges announced plans to market themselves jointly to international investors and said they were confident a venture to allow trading between some of them would be ready before the end of the year.

For now, Taiwan's stock exchange will focus on organic growth, Schive said.

The exchange, which has a total market capitalization of $800 billion, aims to have 55 initial public offerings (IPOs) and Taiwan Depositary Receipts (TDR) issuances this year, up from 39 last year, Schive said.

"Taiwan's strength is in technology, manufacturing and food products. These are the areas we hope to attract companies to list," said Schive, who was formerly the vice chairman of Taiwan's planning commission.

(Writing by Lee Chyen Yee; Editing by Alison Birrane)