Tej Kohli business blog brings the latest news in the business world. NYSE is stuck in a battle of control and who will win remains to be seen. Read the complete report on Tej Kohli blog.

A fight for the control of New York Stock Exchange turned into dueling pleas to shareholders, when a rival bidder accused the exchange for rejecting its $11.3 billion bid without any discussion.

On sunday, NYSE’s board decided to dismiss and offer from rival Nasdaq OMX Group Inc. and Intercontinental exchange Inc. due to its ‘highly confidential’ nature and to avoid the unnecessary risk it would have caused to the shareholders. Alternatively, the organization reaffirmed its plan to merge with German Exchange operator Duetsche Boerse AG in a deal with $10 billion.

Calling their bid ‘clearly superior’ Nasdaq and Intercontinental Exchange Inc. said that by refusing to combine with them, the NYSE’s board is ignoring its obligation to its shareholders.

“I would expect that NYSE Euronext’s stockholders will make their displeasure known to the board,” said Jerry Sprecher, ICE Chairman and CEO.

As NYSE’s is gearing up for its annual shareholder meeting on April 28, it does not have much time to convince their investors to adhere with agreed-to bid against a better offer. Meanwhile, Nasdaq and ICE will continue to meet with NYSE shareholders to pressurize the company and force a discussion.

The format of the NYSE agreement with the German exchange as a merger, instead of a sale, could give company’s board a legal justification to deny a higher deal, says Tej Kohli. But these factors may become controversial if Nasdaq and ICE successfully convinces NYSE shareholders to become directly involved using a proxy vote or a tender offer, continued to say Tej Kohli.

The higher offer on the other hand, has its own risks for shareholders, like the lack of a large break-up fee that would be paid to NYSE shareholders in case the deal does not go through. Most important among them is whether the Nasdaq-led bid could pass regulatory hurdles by combining virtually all U.S. stock listings under one roof, a move that would lead to job losses in the financial services industry.

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