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The talking phase of the CME's proposed $11.3 billion takeover of the New York mart was set to time out by tomorrow, February 28.
Apparently, though, the violation flag won't be raised, as both sides have agreed to extend negotiations to March 15.
The two exchanges entered into a 30-day round of exclusive talks last month, so the extension keeps other interested parties (read: New York Stock Exchange and Deutsche Börse) at bay for two more weeks.
NYMEX and CME are already partners in a 10-year deal that allows NYMEX customers access to CME's electronic Globex platform. A merger of the two marts would create a trading goliath, with dominant market shares in everything from precious metals to agricultural commodities.
The deal, as originally proposed, would give NYMEX stakeholders $36 in cash and 0.1323 of a share in CME stock for each NYMEX share. At current prices, that would value NYMEX shares at $106.22, a 3.9% premium over market.
Even if a deal is reached, regulators may put the kibosh on it. The U.S. Justice Department earlier stated that self-clearing futures markets could be anticompetitive. Both NYMEX and CME operate their own clearinghouses, meaning a deal may require the merged exchanges to split from their back offices.
Stay tuned ...
CME vs. NYMEX Stock Price (1-Year History)
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