[This post was written by CBOT Overlord Peter T-1000 Ribic]
IntercontinentalExchange Inc. issued a preliminary proxy statement to the SEC yesterday urging Chicago Board of Trade shareholders to vote against a rival bid from the Chicago Mercantile Exchange. It is unlikely this will be enough to stop the CBOT-CME merger.
This week Merc sweetened its bid with a $482mm special dividend to CBOT shareholders and received Justice Dept. approval. According to CBOT President and CEO Bernard Dan, "From a strategic and operational perspective, the combination with CME provides outstanding opportunities for growth, efficiencies and innovation, creating the leading global derivatives exchange in all major asset classes and one of the world's most liquid marketplaces."
The ICE proxy statement, which may be sent to CBOT shareholders as early as next week, emphasizes that its bid for CBOT remains about $1bn higher than the CME offer, saying:
The implied value of the ICE Proposal has remained at a consistent, meaningful premium to the implied value of the original CME proposal and the revised, increased CME proposal. Since March 15, 2007, the implied value of the ICE Proposal has always exceeded the value of the Proposed CME Merger.
CME, CBOT Revise Merger Agreement to Provide Increased Value [Chicago Board of Trade]
ICE steps up CBOT battle [Chicago Tribune]
InterContinentalExchange Proxy Statement [SEC]