New York – The consolidation among stock exchanges continues as Nasdaq and Borse Dubai have agreed to a deal to create a group of exchanges with better reach and future products like easy investments in foreign markets. The deal will help to link the US, European and the Middle East markets. Borse Dubai will buy stake in NASDAQ, but the details of the deal have not been revealed yet.
Borse Dubai will buy a 19.9 per cent stake in the US exchange but will only get a 5%voting share. Under the agreement, Borse Dubai will not be able to increase its stake in NASDAQ. Borse Dubai will not be able to say anything against the Nasdaq management publicly.
There are two major bottlenecks for the deal going forwards. Firstly, it has to be approved by Cfius. Secondly, it will need to be passed by like Mr. Chuck Schumer, who recently stated that the emirate of Dubai had a "nexus with terrorism".
Nasdaq and Borse Dubai will soon submit their transaction details for a national security review before the Committee on Foreign Investment in the US (Cfius). The agency will check the details for potential security issues. The review is expected to last 90 days.
Bush administration has informed that the deal will be under scrutiny over national security concerns while many politicians believe that it would be approved. Borse Dubai will become a major player in NY financial markets.
After the deal was announced, there was quick action in the Middle East from Borse Dubai’s rival Qatar. Qatar informed that Qatar Investment Authority (QIA) has acquired 20% stake in London Stock Exchange.