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. Last Updated: 07/27/2016

Exchange Bought for $1.7Bln

SYDNEY, Australia -- The Australian Stock Exchange, or ASX, said it would buy the Sydney Futures Exchange for 2.4 billion Australian dollars ($1.7 billion) in stock to boost revenues as its own growth starts to slow.

Shares in futures exchange operator SFE jumped 27 percent to a record while shares of the ASX rose 8 percent. The price moves lifted the market value of the combined entity to 6 billion Australian dollars, just ahead of the Nasdaq Stock Market.

"This is a strategic and a logical move -- something which the market has been speculating on for a while now," said Troy Angus, a portfolio manager with BT Financial Group.

"But valuations are fairly full for both the stocks, and any share price gains will depend on the synergies that can be achieved."

At Monday's close, ASX traded at 27.5 times June 2006 forecast earnings per share and the bid values SFE at 31.1, both more than double the ratio seen across Australia's benchmark S&P ASX 200 Index, based on Reuters data.

Listed stock exchanges have enjoyed hefty premiums as a wave of mergers and acquisitions sweep global bourses. The London Stock Exchange, which trades at 33 times projected earnings, has rejected a $4.2 billion offer from Nasdaq.

Shares of listed futures exchanges have also shot up, partly on the wings of a worldwide commodities boom.