Nov. 6 (Bloomberg) -- Deutsche Boerse AG placed a final bid to buy a majority stake in the state-owned Warsaw Stock Exchange, seeking to expand into central Europe’s biggest equity market.

The German market operator plans “to lend its full support to the Polish Treasury Ministry’s efforts to strengthen the Warsaw Stock Exchange’s leading positing in the central and eastern European market,” according to an e-mailed statement distributed by public-relations agency Alert Media today. Frank Herkenhoff, a spokesman for Deutsche Boerse, confirmed the statement by phone, declining to give details of the offer.

Poland got three bids by today’s deadline for stakes in the bourse, Maciej Wewior, a spokesman for the Treasury Ministry, said by phone without identifying the bidders and whether they sought majority or minority holdings. The ministry had received 10 preliminary bids from four bourse operators for majority stakes and six financial institutions for minority holdings.

The country’s total equity market capitalization exceeds $130 billion, the third-largest in emerging Europe after Russia and Turkey, according to Bloomberg data. There are more than 470 companies traded on the main market and NewConnect, a platform for small companies, according to the Warsaw bourse’s Web site.

Deutsche Boerse, London Stock Exchange Group Plc, NYSE Euronext and Nasdaq OMX Group Inc. were picked in July for talks in the sale of majority stake in the bourse, while six financials bid for minority holdings.

The bidders for minority stakes were Goldman Sachs Group Inc., Bank of America Corp.-Merrill Lynch & Co., Banco Espirito Santo de Investimento of Portugal, Warsaw-based Bank Pekao SA, Concorde Securities of Hungary and Prague-based Wood & Co., according to the Treasury’s Web site.

New Listings

Warsaw has had the most new listings in Europe after NYSE Euronext in the first nine months of 2009, attracting 22 companies, compared with 23 at the world’s largest operator of stock markets, the bourse said, citing a report by PricewaterhouseCoopers LLP. PGE SA, the state-controlled power producer that raised 5.97 billion zloty ($2.1 billion) in Europe’s largest initial public offering this year, jumped as much as 16 percent on its first day of trading today.

NYSE Euronext spokeswoman Caroline Denton declined to say whether the company placed a final bid by today’s deadline, when contacted by Bloomberg News by phone today. Nasdaq spokeswoman Anna Rasin also declined to comment today.

LSE Pulls Out

London Stock Exchange has withdrawn from bidding for the Warsaw market because the acquisition wouldn’t fit with the company’s new strategy, the Financial Times reported on Oct. 16, citing a person familiar with the matter. Patrick Humphris, a spokesman for the company, declined to comment today.

Poland is selling a 74 percent stake in the exchange, with 23 percent earmarked for its broker members and a majority stake to an industry investor. The government is accelerating asset sales, seeking to raise 36.7 billion zloty through next year to help finance its widening budget deficit amid the country’s worst economic slowdown in a decade.

The sale follows Wiener Boerse’s expansion in the region with the purchase of bourses in the Czech Republic and Slovenia and acquisition of more shares in the Budapest Stock Exchange, in which it increased its stake to 38 percent from 13 percent.

Expansion

Poland’s bourse bought shares in Romania’s futures exchange in 2007 and has expressed interest in taking over the Sofia Stock Exchange if Bulgaria decides on a sale. It also purchased 25 percent of Ukraine’s Innex bourse last July.

The benchmark WIG20 Index dropped 1.3 percent to 2,276.74 today, trimming this year’s advance to 27 percent.

The Warsaw bourse, founded two years after Poland’s communist government collapsed in 1989, posted net income of 81.4 million zloty last year. Deutsche Boerse and NYSE trade at 14.2 times estimated earnings, according to Bloomberg data.

“Deutsche Boerse is constantly evaluating options to further enhance the growth of the company,” Reto Francioni, chief executive officer of Deutsche Boerse, said on a conference call with analysts today. “We can only proceed with the project if the transaction makes sense from a shareholder and company perspective as far as Warsaw is concerned.”

To contact the reporter on this story: Pawel Kozlowski in Warsaw pkozlowski@bloomberg.net; Nathaniel Espino in Warsaw nespino@bloomberg.net

Last Updated: November 6, 2009 12:02 EST