Cbot Holdings, holding company for the Chicago Board of Trade (CBOT) (NYSE: BOT), one of the leading global derivatives exchanges, today announced that Institutional Shareholder Services (ISS) has recommended that CBOT stockholders vote FOR the merger agreement with the Chicago Mercantile Exchange Holdings (NYSE: CME) at the Special Stockholders Meeting scheduled for July 9, 2007.
In making its recommendation, ISS said the following:
"The functionality and scale of a derivative exchange's clearing and electronic trading platform are critical components for successful integration. More important than scale, however, is functionality. In a merger with CME, integration risk is low because, among other things, CME and CBOT have already completed a common clearing link in 2003. This common clearing link also gives CBOT/CME a leg up in the amount of time it would take to complete the integration."
The report concluded: "...if one is to compare ICE's adjusted offer price with CME's offer price, the difference between the two offers is marginal. CBOT shareholders have greater exposure to a reduced realized value in a transaction with ICE than with CME. This is reflective of the greater integration risk and less compelling strategic fit for ICE than for CME. We therefore believe that a combination of CME and CBOT presents a compelling opportunity for shareholders." *
ISS is a leading independent U.S. proxy advisory firm and its voting analyses and recommendations are relied upon by hundreds of major institutional investment funds, mutual funds and fiduciaries throughout the country.
The Board of Directors of CBOT Holdings unanimously recommends that stockholders vote "FOR" the adoption of the agreement and plan of merger, and the Board of Directors of CBOT unanimously recommends that CBOT members vote "FOR" the matters related to the merger as described in the joint proxy statement/prospectus and the supplement.
*Permission to use quotes neither sought nor received.