NYMEX Board Reaffirms Commitment to Acquiring Up to 70% of IPE

The New York Mercantile Exchange (NYMEX) board of directors on Wednesday night finalized the terms of its offer to acquire up to 70% of the International Petroleum Exchange (IPE), under similar terms and conditions to those presented to the IPE by the outside investor group known as Plan B and called upon the IPE to appoint a negotiating committee so that an agreement in principle can be reached by September 17. Exchange Chairman Daniel Rappaport said, "The NYMEX board is very enthusiastic about the synergistic advantages that can be brought to both exchanges through the formation of a combined entity and is eager to move forward with a deal that is valued at £35.7 million ($57.5 million), similar to the deal that was supported by the IPE board last month. In an effort to be sensitive to the hopes and fears of the IPE members, we are prepared to consider other trading protections for IPE members as well as areas of mutually beneficial business opportunities consistent with the spirit of the transaction. We strongly believe it is important to begin working with IPE representatives as soon as possible to resolve these issues and complete an agreement in principle that can be brought in front of the requisite UK regulatory authorities and the IPE members for consideration." The NYMEX proposal is based on the same holding company valuation as the outside investor proposal. The proposal will provide the IPE members with the same trading right protections and also contains a commitment that it trading will not be introduced on NYMEX in any IPE contract during open outcry hours and will not change any of the IPE's existing trading or settlement procedures.