CME Boosts CBOT Buyout Terms

Its 'best and final' offer wins support of the commodity exchange's largest shareholder.
Publish date:


Chicago Mercantile Exchange

(CME) - Get Report

has sweetened its buyout terms for the

Chicago Board of Trade


ahead of a shareholder vote on a competing offer by the


(ICE) - Get Report


CME's "best and final" bid offers CBOT shareholders a stock exchange ratio of 0.375, up from a prior proposal of 0.350, according to a filing with the

Securities and Exchange Commission

. The filing also indicates that CME has won the support of CBOT's largest shareholder, Caledonia Investments, with its new deal.

The revised terms mean CBOT shareholders would receive 36.2% of a combined company, up from 34.6%.

The new agreement comes three days before shareholders decide whether CME's deal trumps ICE's unsolicited bid for CBOT.

"This enhancement to the terms of our merger agreement reflects our commitment to joining forces with the CBOT and our conviction that no combination can match the benefits we will create for all shareholders, members and customers," said CME Executive Chairman Terry Duffy in a statement.

CME and Atlanta-based ICE have been at loggerheads in their attempt to purchase commodities and futures exchange platform CBOT over the past several months.

The CME originally agreed to buy the CBOT in October, but it has been forced to tweak its offer several times to give CBOT shareholders a bigger stake in the combined company. It has also agreed to complete a big buyback once the deal is done.

ICE entered the race for CBOT in March, and juiced its bid to about $11.9 billion in late June.

Shares of CBOT recently were up $1.90, or 0.9%, to $206.15. CME shares rose $16.34, or 3%, to $555.69.