Shareholders wrap up voting on a merger deal that would combine the parents of the Chicago Mercantile Exchange and Chicago Board of Trade to create the world’s largest derivatives exchange.
Most analysts are predicting victory for Chicago Mercantile Exchange Holdings Inc. after the company improved its bid for a third time on Friday in an 11th hour move to quell dissent among CBOT Holdings shareholders.
“Very, very confident” the purchase of CBOT, which was first announced in mid-October, will be approved, says, CME’s Chief Executive, Craig Donohue.
Caledonia Investments Pty. Ltd., the largest owner of CBOT shares, dropped its opposition to the deal after terms were approved. Ray Cahnman, a former CBOT board member and owner of four CBOT memberships, said Caledonia’s decision to vote for the deal had a huge influence on other CBOT members. Cahnman previously opposed the CME-CBOT deal, but now says “Caledonia are very shrewd and very experienced”.
At Friday’s closing prices CME’s bid was worth about $11.9 billion, including a one-time special dividend by CBOT payable upon the deal closing. ICE’s bid valued CBOT at about $11.8 billion.