CBOT Directors Approve Historic Restructuring

Continuing its tradition as the industry standard bearer, the Board of Directors of the Chicago Board of Trade yesterday overwhelmingly approved a plan to restructure the exchange. The restructuring recommendation calls for the demutualization of the CBOT with current members becoming shareholders in two new companies. The first company will retain the open outcry platform of trading and will be a closely held, for-profit company. The for-profit status will allow for improved decision-making and a more economically viable business that can take advantage of trading volumes that thrive in the open outcry environment. The second company will establish an electronic trading capability. This company is expected to trade all current CBOT contracts, plus additional products, in an open access environment. It is expected that equity interests in this new company will be distributed to CBOT members, potentially followed by an initial public offering. No offering of securities will be made in connection with any of the foregoing transactions except by means of a prospectus. In a letter to CBOT members distributed earlier today, CBOT Chairman David P. Brennan said, "This is an historic time for the Chicago Board of Trade. The CBOT has built its leadership position by being highly responsive to customers and having superior management. This restructuring is another ground-breaking step in continuing the Board of Trade¹s tradition of industry leadership in the increasingly global and technologically advanced marketplace." The restructuring initiative is subject to membership approvals.