Chicago is My Home

03
Jun

CME’s CBOT, CBOE Reach $1 Billion Settlement in Ownership Rights Case

Author: Adam Fendelman, Category: Business

CHICAGO – The CME Group’s Chicago Board of Trade (CBOT) and the Chicago Board Options Exchange (CBOE) reached a $1 billion settlement on Monday that ended a two-year legal battle. The deal also freed the CBOE to pursue independent strategic growth opportunities.

The terms of the settlement dictate that some CBOT members with trading rights at the CBOE and a minimum of 10,251 shares will receive an 18 percent stake in the exchange and $300 million in cash.

Members of the CBOT, which was bought by CME in 2007 for $12 billion, have been fighting for ownership rights in the CBOE for nearly two years in Delaware court. The legal dispute tied down the CBOE and kept the exchange from making strategic moves such as issuing an IPO or striking a lucrative merger deal.

The CBOT and CBOE froze sales of trading memberships on Monday as the two sides met to finalize the terms of the settlement. A key hearing in the case is scheduled for Wednesday. The settlement must be approved by the Delaware court and by CBOE members.

By Megan O’Neil