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The HEX Group, the owner of the Helsinki, Tallinn and Riga stock exchanges, intends to merge the three trading houses into a single trading environment by May 2004.
"Our goal is that when Estonia and Latvia join the European Union in May next year, we will be able to create a single trading environment from the customers' point of view," Jukka Ruuska, CEO of HEX, was quoted by the Finnish daily Helsingin Sanomat as saying.
Despite the merger, the new united exchange will not comprise a very large trading environment, as only 14 companies are listed on the Tallinn Stock Exchange and 62 on the Riga Stock Exchange.
But new issuers are expected to enter the market, Ruuska added.
HEX's Baltic department Vice-President Gert Tiivas said that May 2004 was not a strict deadline for merging the trading houses, but that the date was a motivating factor for the parties involved in the process.
He added the market players would not have to wait for completion of the integration to start feeling the effects of the merger. Changes will appear gradually as the process advances.
RSE President Guntars Kokorevics said it was hard at the present time to say how deep the integration of Estonian, Latvian and Finnish bourses would be by May 2004, but that the merger would definitely be to the benefit of investors in all three countries.
"The goal of the RSE is to join an expanded chain of stock exchanges. The merger with HEX - one of the strongest stock exchange groups in Europe - is a chance to do this and we are working on it actively," he said.
Last March HEX and RSE announced the beginning of strategic cooperation, and in August 2002 HEX and RSE shareholders signed all the necessary agreements for HEX to acquire 92.98 percent in RSE.
As a result of the deal, the HEX Group became majority owner of the RSE Group, which consists of the stock exchange and depository. It is a similar arrangement to that in place in Finland and Estonia. The RSE Group will be part of HEX's Baltic operations.
HEX took control over Tallinn Stock Exchange in 2001, and integration into the HEX trading system took place in February 2002.