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Wed 2 Jan 2008 09:50 AM

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Dubai, Nasdaq deal gets green light

The US gov't clears deal that will give emirate's stock exchange minority stake in US bourse.

The US government has cleared a deal that will give Dubai's state-owned stock exchange a minority stake in Nasdaq, the US stock exchange said on Monday.

Nasdaq, which first made the announcement on Friday and then withdrew the notice saying it had been issued in error, said the federal approval allows it and Borse Dubai to proceed with a deal reached earlier this year. Under the pact, Dubai gets Nasdaq's stake in the London Stock Exchange Group and a minority stake in the US exchange.

It will also allow Nasdaq to proceed with its plan to combine with Stockholm-based OMX.

The $5 billion joint bid between Borse Dubai and Nasdaq for the Nordic bourse operator, will create a global group of exchanges connecting the US, Europe, the Middle East and Asia.

Nasdaq and Borse Dubai, parent company of the Dubai Financial Market (DFM) and Dubai International Financial Exchange (DIFX), agreed to take over Nordic bourse owner and technology firm OMX in September.
Under the deal, which gives Nasdaq a 33% stake in the DIFX, Nasdaq plans to invest $50 million and allow Dubai to use its name in the Middle East, North Africa and South Asia, Borse Dubai chairman Essa Kazim told newswire Reuters in September.