CHICAGO - The parent company of the Chicago Mercantile Exchange and the Chicago Board of Trade said Monday it would buy the New York Mercantile Exchange in a $9.4 billion cash-and-stock deal that melds the nation's two largest futures exchanges.
CME Group Inc. agreed to pay $3.4 billion in cash and about $6 billion in stock for Nymex Holdings Inc. as part of the buyout that was first discussed earlier this year.
The combined company will continue to operate electronic and open-outcry trading platforms in both New York and Chicago, as long as the New York trading floor meets certain revenue and profit requirements, executives said.
"The floor has been very profitable and is a valued part of the history and continues to be," said Nymex Chairman Richard Schaeffer. "We at Nymex expect to continue that profitability for a long period to come."
Under terms of the agreement, Chicago-based CME will pay 12.5 million shares -- valued at $6 billion based on the stock's Friday closing of $486.05. Nymex holders will get 0.1323 Class A shares of CME Group and $36 in cash for each share outstanding.
Priced at $100.30 per share, a 5 percent premium over Nymex's closing price on Friday, the deal is valued at about $9.43 billion, based on roughly 94 million shares outstanding at Feb. 20. Shareholders of Nymex will own about 19 percent of the combined company.
CME Group Executive Chairman Terry Duffy will remain in his post along with CME Group Chief Executive Officer Craig Donohue. CME Group will add three Nymex directors to its board. The transaction must get regulatory and shareholder approval and is expected to close in the fourth quarter.
Analysts praised the deal, saying it will give CME an important foothold in the market for energy derivatives and access to new geographic areas.
