Latin American Capital Markets

288 ROBERTA S. KARMELThereafter; ASX Ltd., the parent company of the Australian Stock Exchange,proposed to take over the Sydney Futures Exchange, 38 but then found itself in a biddingwar for the futures exchange with Computershare Ltd., a share registry and softwarefirm. 39 This threat to the Australian Stock Exchange's monopoly and plans for thefuture were complicated further by the submission of their merger plan to the AustralianCompetition and Consumer Commission (ACCC), which considered it to beanticompetitive. 40 The ACCC response, coupled with an increased bid from Computershare,has all but removed any hopes of an alliance between the two exchanges. 41The key issue raised before the ACCC was whether a securities exchange should beprotected and fostered as a national capital market champion or just another entitycompeting in the marketplace like the companies that use it to raise capital. 42According to a survey released by the Australian Stock Exchange in February2000, demutualization and privatization dramatically increased share ownership amongAustralians 43 From 1998 to 2000, the number of people in the share market nearlydoubled, and Australia could boast of the highest participation of adults in the sharemarket in the world, with 53 percent of Australians owning shares (including direct andindirect share ownership) as compared with 48 percent share ownership in the UnitedStates. 44 Factors contributing to this dramatic increase included increased media publicityabout winning fast profits in the share market, 45 easier access to markets, and reducedtrading costs through Internet trading; the privatization of former governmententerprises; the demutualization of ASX and the major life insurance companies; 46 theincrease in superannuation; and the presence of a bull market 47 Despite obvious optimism,commentators were concerned that there was an undue concentration of investmentin too few companies and encouraged investors to diversify. 4838 Australian Stock "Futures Exchange to Merge," National Post, April 28, 1999; I999WL 13671786.39 "Bidding War Breaks out Over SFE," Independent Business Weekly 18, May 26, 1999; 1999 WL 12566164.40 Ian Harper "Let's Face Reality: Go Global," Australian Financial Review, July 21, 1999; 1999 WL 19334887; Eli Greenblat,"Pels Warning as SFE Ruling Delayed," The Age, July 22, 1999; 1999 WL 21 179820.41 Stephen Bartholomeusz, "Why There's No Futures for The Bourse," Sydney Morning Hera/d,July 30, 1999; 1999WL 21601567.42 "Mapping the Futures of Exchanges," Australian Financial Review, July 31,1999, p. 20; 1999 WL 19335693.43 "Ownership of Shares In Australia Increases to 53% of Adute," Asian Wall Street journal, February 9, 2000, p. 17;Leanne Bland, "Your Eggs in One Basket? May As Well Back A Horse," Sydney Morning Herald, February 9,2000, p. 6.44 Leanne Bland, "A Share of the Action," Sydney Morning Herald, February 12,2000, p. 128; 2000 WL 231 I 10; "ShareRevolution Must Put Stock in Diversity," Australian Financial Review, February 12,2000, p. 20; 2000 WL 3977215.45 Henry Bosch/To Market,To Market" Shores Magazine, April 1,2000, p. 144; 2000 WL 2104638.46 "Share Revolution Must Put Stock in Diversity," Australian Financial Review, February 12, 2000, p. 20; Leanne Bland,"A Share of the Action," Sydney Morning Herald, February 12,2000, p. 128.47 Henry Bosch,"To Market,To Market" Shores Magazine, April I, 2000, p. 144.48 "Share Revolution Must Put Stock in Diversity," Australian Financial Review, February 12,2000, p. 20.Copyright © by the Inter-American Development Bank. All rights reserved.For more information visit our website: www.iadb.org/pub