DOW JONES NEWSWIRES
CME Group Inc. (CME) has reached an agreement with fellow
exchange company BM&FBovespa SA (BVMF3.BR) to jointly develop a
new trading platform.
In accordance with the agreement, Brazil-based
BM&FBovespa--the world's third-biggest exchange company by
market capitalization--will increase its ownership stake of CME to
5%, buying shares for $275.12 each, a 3.5% discount to Thursday's
closing price. CME said it plans to buy back up to 2.35 million
shares of its stock, offsetting the dilution from shares issued to
BM&FBovespa.
BM&FBovespa's current stake in CME wasn't disclosed Friday,
while CME already owns roughly 5% of BM&FBovespa. After
deal-related transactions are complete, CME will nominate a
BM&FBovespa representative to its board of directors.
The multiclass electronic trading platform to be developed by
both exchanges will be deployed by BM&FBovespa for its cash
equities and derivatives markets. The companies will be able to
license the platform to other exchanges internationally. The system
is expected to launch in early 2011, when it will replace
BM&FBovespa's existing trading systems.
It's the second agreement this week for CME, which on Wednesday
agreed to form a joint venture with Dow Jones & Co., the
publisher of this news service, that will own Dow Jones'
stock-indexing business, including the 114-year-old Dow Jones
Industrial Average. In that deal, CME will take a 90% ownership
interest, with the rest owned by Dow Jones, a unit of News Corp.
(NWS, NWSA).
Shares of CME closed at $285.07 on Thursday and were inactive
premarket. The stock is up 48% in the past year.
-By Nathan Becker, Dow Jones Newswires; 212-416-2855;
nathan.becker@dowjones.com