Combined CME Group to get cash assistance; axe 400 jobs
17 July 2007 | 3352 views | 0
The newly-combined CME Group is set to receive millions of dollars in government assistance even though it is gearing up to axe around 400 jobs, according to press reports.
City officials have defended the move to offer the CME Group financial assistance to keep the combined exchange in Chicago.
Chicago Mayor Richard Daley told reporters at the Chicago Tribune that it was "very important" to keep the merged exchange in the city and he will do "anything possible to make sure they are staying here".
The city's offer of financial assistance was first reported by Crain's Chicago Business, which cites letters sent to the heads of the exchanges days before shareholders approved the merger.
In one letter, Lori Healey, Mayor Daley's chief of staff, is reported to have offered millions in potential aid to help the exchange get off to a fast start following the merger. Illinois' economic development director Jack Lavin is also thought to have sent a letter offering the group financial assistance.
Healey's letter reportedly says that the merger of the two Chicago exchanges "will allow the retention of 1750 jobs, plus the creation of approximately 750 new jobs over the next ten years".
This means about 400 jobs could be lost in the meantime, according to the reports which cite a person familiar with the matter.
CME spokesman Allan Schoenberg told reporters that he does not know how many people will lose their jobs, but affected employees will be notified in mid-August.