Summary
CME Group Inc. (CME) announced a significant development on October 17, 2006, with the signing of an Agreement and Plan of Merger to acquire CBOT Holdings, Inc. (CBOT). This strategic move will result in CBOT Holdings merging into CME Holdings, with CME continuing as the surviving entity and CBOT becoming a subsidiary. The transaction is structured as a stock-for-stock exchange, with CBOT shareholders to receive 0.3006 shares of CME Class A common stock for each CBOT share they hold. A cash election option is also available, capped at $3.0 billion and subject to proration if oversubscribed. This merger represents a major consolidation in the exchange industry, aiming to create a larger, more diversified entity. The deal is subject to customary closing conditions, including shareholder approvals from both CME and CBOT, as well as regulatory clearances.
Key Highlights
- 1CME Group Inc. (CME) has entered into a definitive merger agreement to acquire CBOT Holdings, Inc. (CBOT).
- 2The transaction is structured as a merger where CBOT Holdings will merge into CME Holdings, with CME as the surviving company.
- 3CBOT shareholders will receive 0.3006 shares of CME Class A common stock for each share of CBOT Class A common stock held.
- 4A cash consideration option is available to CBOT shareholders, capped at an aggregate of $3.0 billion and subject to proration.
- 5The merger is contingent upon several closing conditions, including approval from the stockholders of both CME Holdings and CBOT Holdings.
- 6Regulatory approvals are also a necessary condition for the completion of the merger.
- 7A termination fee of $240.0 million may be payable by either CME or CBOT under specific circumstances if the agreement is terminated.