Ontario's top politicians have already reached out to bank CEOs to solicit thoughts on the deal. Similarly, federal Finance Minister Jim Flaherty has been asking bank CEOs for their opinions during previously scheduled pre-budget meetings that have taken place over the last two weeks.
Some of the bank CEOs are very supportive. "If Toronto is going to grow as a global financial centre, the benefits of a global exchange co-headquartered in Toronto likely outweigh the implications of a local exchange that will become increasingly less relevant over time as trading and exchanges globalize," Gordon Nixon, CEO of Royal Bank of Canada, told The Globe.
Mr. Nixon noted that he has a conflict of interest, both because RBC Dominion Securities is advising LSE on the deal and because Royal Bank of Canada is one of the firms that owns the Alpha Group, an alternative trading system set up in 2007 that is the TSX's biggest Canadian rival. (Other part owners of Alpha include the rest of the country's largest banks as well as Canaccord Financial Inc. and the Canada Pension Plan Investment Board.).
But The Globe's survey shows that the exchanges would be wise to disclose more, and do a better job of explaining it, as they fight for their deal to go through.
Sean Boyd, CEO of Agnico-Eagle Mines Ltd., said he is frustrated by the lack of information. "They haven't really articulated what it's going to mean for us," he said. "The big market cap companies, you think they'd be calling [them]and saying 'This is how it's going to unfold.' I don't think we know."
Despite the lack of details, Mr. Boyd said Ottawa should not intervene. "This is happening worldwide," he said. "We have to look at making alliances to increase exposure for Canadian companies into wider pools of investment dollars."
Mining executives expressed some fear that Toronto's mining finance community could be overshadowed by London following the merger, because that city is a more compelling place to live. But they still said that Ottawa should not intervene, because the TSX could become marginalized if the deal doesn't go through and, following on the heels of the government's rejection of the Potash Corp. deal, it would signal that Canada is closed to foreign investment.
A number of executives across various sectors said it would be difficult for them to argue that Canada should block any deal, given that they are expanding into other countries themselves.
"We at Canaccord believe that Canada should be open to foreign investment," said Canaccord chief executive officer Paul Reynolds.
And quite a few business leaders took the argument a step further, saying flat out that Ottawa has no business weighing into this deal. "If the Canadian government subscribes to and practises free trade and open market economics, it should leave it alone," said Ed Miu, chief financial officer of Eldorado Gold Corp.
"Who cares?" said Bill Holland, chief executive officer of CI Financial Corp., adding that exchanges are now "nothing more than a bunch of servers and a name.
"The bigger the better," he said. "All you're trying to do is get the most liquidity at the best prices. Is it something that is vital to Canadian interests? Not at all. It's a non-issue."
VOICES ON THE TORONTO-LONDON STOCK EXCHANGE MERGER
Pat Daniel, CEO of Enbridge (#23 in the TSX 60 index)
"I am a very big believer in Canada entering and participating in global markets, whether it be through our Gateway pipeline project in the energy industry becoming more global, to the way in which we trade our shares. To the extent that it makes it easier for Canadian companies to list on the LSE, and therefore attract more foreign capital to Canadian companies, we would view it as positive."
Denis Jasmin, vice-president of investor relations at SNC-Lavalin (#45 in the TSX 60 index)
"It will attract more interest from foreign investors and analysts to Canadian companies, more exposure. I believe it will also improve TSX services, technology and products."
John Dielwart, CEO of ARC Resources Ltd. (#51 in the TSX 60 index)
"I don't see any real downside to the merger. Technology is key to that business moving forward, so it seems to me a larger, more global enterprise will have better resources to stay ahead of the curve in that area."
"[I]don't really expect the merger to have any real affect on business. [It] may facilitate increased investment from Europe but certainly not material. [The]government should not intervene. [It is]neutral to Canada."
With files from Greg Keenan, Grant Robertson and Boyd Erman in Toronto, Brenda Bouw and David Ebner in Vancouver, Carrie Tait in Calgary and Bertrand Marotte in MontrealReport Typo/Error