For CME Group, this alliance with Bursa Malaysia is a furtherance of CME Group strategy of extending its transaction processing services business through partnerships around the world.

The two companies successfully entered into a series of strategic partnership agreements that will involve three collaborative aspects which include equity participation, licensing of the Bursa Malaysia Derivatives Berhad crude palm oil futures (FCPO) settlement price and the provision of CME Globex® services. The signing of these agreements has been duly approved by the Securities Commission of Malaysia (SC). This collaboration is also among the first strategic partnerships to take place close on the heels of the recent deregulation of the Foreign Investment Committee (FIC) rule covering acquisition of equity stakes, mergers and takeover.

In terms of equity participation, the CME Group will be acquiring a 25% equity interest in Bursa Malaysia Derivatives Berhad, a wholly-owned subsidiary of Bursa Malaysia. In essence, this equity participation primarily aims to strengthen the overall partnership beyond vendor-based relationships.

As a means to strengthen Malaysia's position as the global price benchmark for crude palm oil, Bursa Malaysia Derivatives will license to CME Group the right to use its settlement prices for its RM-denominated CPO futures contract (FCPO). This license agreement provides for the development of USD-denominated cash-settled CPO futures contracts and related options for listing on one of CME Group's U.S. designated exchanges. These, in turn, will be traded on CME Globex, CME Group's electronic trading platform. Subject to appropriate regulatory filings, the listing of CME's USD-denominated CPO futures contract is expected to commence in the first half of 2010.

In addition, the collaboration will also see the listing of all existing and future Bursa Malaysia Derivatives' products on CME Globex. Bursa Malaysia Derivatives will continue to operate and regulate its market and have control over trading hours, product and specifications, spread definitions and pricing, within the parameters supported by CME Globex.

With multiple access points through eight telecommunications hubs globally, CME Globex offers unparalleled global distribution. The transfer of all Bursa Malaysia Derivatives products to CME Globex is expected to take place in the second half of 2010.

Dato' Yusli Mohamed Yusoff, Chief Executive Officer of Bursa Malaysia said, "Bursa Malaysia is committed to ensuring that our capital market's value propositions and derivatives offerings are not only maintained but also enhanced. CME Group's reach, expertise and track record provide us with a springboard to take our established positions in the derivatives market to greater heights of success."

"This collaboration is in line with our efforts to further penetrate and expand our products and services offerings in Asia as the derivatives industry in the region is enjoying a robust stage of growth," said CF Wong, CME Group Managing Director of Asia. "Bursa Malaysia's unique strength in the palm oil industry enables CME Group to offer our customers access to this much-in-demand commodity."

Prior to the acquisition, a restructuring exercise will be undertaken to consolidate all of Bursa Malaysia's derivatives businesses into Bursa Malaysia Derivatives Berhad. This will involve the acquisition of 100% equity interest in Bursa Malaysia Derivatives Clearing Berhad from Bursa Malaysia. The proposed equity participation by the CME Group is expected to be completed in the fourth quarter of 2009.

Upon completion, the equity participation is expected to enhance Bursa Malaysia's consolidated net asset and earnings per share, arising from the gain from the divestment of 25% interest in Bursa Malaysia Derivatives Berhad of approximately RM44 million.