A Delaware court on Wednesday handed the Chicago Board Options Exchange a victory in a long-running court case, moving the exchange one step closer to its goal of demutualization.

The dispute over a portion of CBOE's ownership is the final hurdle as the biggest U.S. options exchange moves toward shareholder ownership, a transition that will let CBOE pursue an initial public offering or a merger.

The case centers on the settlement of ownership rights in the CBOE held by about 1,000 Chicago Board of Trade members; under the terms of the deal, the group would get an 18% equity stake in a demutualized CBOE, along with $300 million in cash.

The CBOE was established by the CBOT, now part of CME Group Inc. (CME), in 1973.

Some members in December raised an objection to the settlement terms, but the protest was overruled in Wednesday's decision by Delaware Chancery Court Judge John Noble.

Following the ruling, the CBOE will have to wait out a 30-day appeal period before it can move ahead with its plan to become a shareholder-owned entity.

"We are extremely gratified to have reached this important milestone on the path to CBOE's demutualization and plan to move forward with the demutualization process once the Delaware court proceedings are satisfactorily concluded," said CBOE Chairman and Chief Executive William Brodsky in a statement.

If an appeal is filed, the case could go to the Supreme Court of Delaware, further delaying CBOE's three-year quest for demutualization.

But if the 30-day appeal clock runs out, the CBOE can move forward, although a membership vote on demutualization will likely take at least a month, with another two to three-month ramp-up before an initial public offering could happen.

In May, a CBOE membership sold for $1.77 million, the highest price recorded for 2009 but well below the $3.1 million a seat fetched at the beginning of last year.

At 930 members, the most recent seat sale values the exchange at about $1.65 billion.

May saw average daily volume at the CBOE rise 22% over the year-ago period as the exchange handled almost one-third of all U.S. options trade.

In April, CBOE reported that first-quarter revenue slipped 5% to $98.6 million as options trading activity recovered from a January slump, with net income 21% lower than the year-ago period.

The exchange reports financial information as though it is a for-profit entity.

-By Jacob Bunge, Dow Jones Newswires; 312-750-4117; jacob.bunge@dowjones.com