CME to buy Nymex
Even as Wall Street teeters and he derivatives markets sink, US-based CME has announced that it has reach an agreement to buy Nymex, the largest US energy trading market. The deal is for $9.4 billion, a lower price than first offered, since Nymex like other financial-related companies has seen a decline in stock prices in the last few months.
The deal will enhance CME's presence in the energy futures market, where it is already a smaller player. The Nymex (formerly the New York Mercantile) sells futures contracts in oil and natural gas, along with platinum and palladium. Gold, silver, copper, and aluminum futures are sold on the COMEX subsidiary. Nymex's biggest competitor in energy is Intercontinental Exchange (ICE), which got into the US oil futures market in 2006.
It comes a year after long after the acquisition by the Chicago Mercantile Exchange of the Chicago Board of Trade to make CME Group, the #1 futures exchange in the world. That deal was for over $11 billion. Nymex has had a partnership with the group, as it uses the CBE electronic trading platform, Globex. The recent move to an electronic system away from traditional floor trading has increased Nymex's trade volume substantially.
It's anothe rmarker on the road to worldwide consolidation of financial markets.
