Minneapolis Grain Exchange Rejects Bid For Voting Control

The Minneapolis Grain Exchange (MGE) Board of Directors on August 23 rejected Michael Blake's offer to purchase enough memberships to gain voting control. Blake's desire to purchase 200 memberships, in addition to 23 he currently owns, would have given him ownership of more than 50 percent of the Exchange's 402 seats. The bid for 200 memberships at $20,000 each was conditioned upon five contingencies: 1.Enforcement of Rule 370.00 (Limit on Ownership of Memberships), Rule 371.00 (Exchange Defense Expenses) and Rule 202.03 (Voting: Number of Votes Permitted) is stayed pending the outcome of the bid. 2.At least 150 memberships are offered for sale to Blake at this price. 3.No material adverse change occurs in the business or operations of the MGE. 4.No legal action against Blake is threatened or commenced by the MGE. 5.No increase in outstanding memberships is impending or occurs. The board reviewed the history and charter of the Exchange-a 118-year-old member-owned, not-for-profit business organized to provide risk management and price discovery tools for its members. Those members are producers, handlers, manufacturers, consumers and traders of the products listed at the MGE. The mission statement of the Exchange declares that its goal is to provide an environment in which price discovery and risk transfer services will create profit opportunities for the membership and its public constituency. The board reaffirmed those views and stated, again, that membership value will increase as the demand for its services increases, not as a reaction to speculative demand to "pursue new avenues," as stated in a letter from Blake to MGE President and CEO James H. Lindau. The Minneapolis Grain Exchange, established in 1881, is the only futures market for hard red spring wheat, white wheat, durum wheat, black tiger shrimp, white shrimp and Twin Cities on- and off-peak electricity. For more information about the Exchange, visit http://www.mgex.com.