by CIO Staff

CME to Buy CBOT for $8B

News
Oct 17, 20061 min
Outsourcing

The Chicago Mercantile Exchange (CME), the largest financial market in the world by market value, will acquire the Chicago Board of Trade (CBOT) for roughly $8 billion—a buy that will form the world’s largest derivatives exchange, Bloomberg.com reports.

CBOT shareholders are to receive approximately 0.3006 shares of CME Class A stock in exchange for each CBOT share—or a comparable sum of cash—and the new firm, dubbed CME Group, will be 69 percent owned by CME shareholders, according to Bloomberg.com.

Customers of the new firm will have access to exchange-traded derivatives based on U.S. interest rate yield curve, equity indexes, foreign exchange, and agricultural and industrial commodities, among other options, Bloomberg.com reports.

Current CME Chairman Terrence Duffy will take the chairman reins at the combined company, and CBOT Chairman Charles P. Carey will take on the vice-chairman post, according to Bloomberg.com.

CBOT shares were up roughly 16 percent to $156.20 in early-morning New York trading, and CME shares saw an approximately 4 percent increase to $522.53, Bloomberg.com reports.

Related Links:

  • IT at the Chicago Mercantile Exchange

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