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NYBOT and PE-backed ICE reportedly in merger talks

The New York Board of Trade, the commodity futures exchange, is in preliminary discussions about a merger with PE-backed IntercontinentalExchange which could be valued at up to $900m, according to news reports.

IntercontinentalExchange (ICE), the Atlanta-based operator of global electronic commodities marketplaces—which counts Goldman Sachs, Morgan Stanley, and TA Associates among its investors—and the New York Board of Trade (NYBOT) are in the early stages of talks that could lead to a $900 million (€709.5 million) merger, according to the New York Post.

ICE may be interested in NYBOT’s clearing business for processing trades and performing other operations, which are tasks that ICE currently outsources, said the Post.

NYBOT’s CEO, Charles “Harry” Falk, had said in May that the exchange was considering going public, and it had been approached by several other exchanges regarding a possible merger, including ICE’s largest competitor, the New York Mercantile Exchange (NYMEX). Falk had previously denied persistent rumors of a NYBOT-NYMEX merger in late 2004. NYMEX itself filed for a $250 million initial public offering this week.

ICE, meanwhile, just announced the pricing of its secondary stock offering earlier this week, at $56 per share for eight million shares. ICE had its initial public offering in November 2005.

NYBOT provides futures and options markets for internationally traded agricultural commodities such as coffee, cocoa, cotton, sugar and frozen concentrated orange juice. ICE operates global over-the-counter marketplaces for the trading of commodities on the Internet. In 2001, the London-based International Petroleum Exchange (IPE), Europe’s leading energy futures and options exchange, became its subsidiary.