CME to buy CBOT for $8 Billion

[Hobbs]

The Chicago Mercantile Exchange, the world's biggest financial market by market value, agreed to buy the Chicago Board of Trade for about $8 billion, creating the largest derivatives exchange.

Stockholders will receive 0.3006 shares of CME Class A common stock for each share or an equal amount in cash, the companies said in a statement today. The new firm, to be called CME Group Inc., will be owned 69 percent by Chicago Merc shareholders.

The company will provide customers access to exchange-traded derivatives based on U.S. interest rate yield curve, equity indexes, foreign exchange, agricultural and industrial commodities, energy and alternative investment products such as weather and real estate. Terrence A. Duffy, chairman of CME, will be chairman of the combined company. CBOT Chairman Charles P. Carey will serve as vice-chairman.

http://www.bloomberg.com/apps/news?pid=20601103&sid=a5OQr1NszXhU&refer=us

[Anatole]

Since the exchanges went public they were able to assign a value to eachother and finally come to an agreement.

The combination will create the largest financial institution in the world, with $4 trillion in contracts traded daily.

This will be great for Chicago!

[Boba Trader]

The Merc's open outcry operations are set to move to the CBOT building. With the CME being the dominant party in this deal it seems like their business culture will prevail.

[Bertie]

This Chicago Tribune article covers the combining of the 2 different cultures, interesting:

http://www.chicagotribune.com/business/chi-0610220145oct22,0,7078754.story?track=rss

Looks like this will really happen.

[Psycho]

Before the 2000s CBOT was Chicago's premier exchange and in a very short period the CME took that honor and is now devouring the CBOT.

My-oh-my have times changed.