The consolidation of trading venues is continuing with the IntercontinentalExchange (ICE) announcing a deal to acquire the New York Board of Trade.

The ICE is an electronic energy marketplace. It has entered into a definitive merger agreement to acquire the NYBOT, the commodity exchange, for approximately US$1 billion.

The transaction consideration will comprise 10.297 million shares of ICE common stock and US$400 million in cash. On closing, the NYBOT will become a whollyowned subsidiary of the ICE.

“The combination of two global and rapidly growing commodity marketplaces, together with a highly respected clearinghouse, allows us to expand ICE’s offerings for market participants, as well as create long-term shareholder value,” said ICE’s chairman and CEO Jeffrey Sprecher.

“We believe NYBOT’s strong heritage, diverse range of products and rapidly growing markets, combined with ICE’s proven innovation, global reach and ability to successfully integrate acquisitions, will create a premier global derivatives exchange. We look forward to working together with the floor community to expand NYBOT’s product offering and customer base,” he added.

Prior to consummation of the merger, the ICE has agreed to make its widely distributed commodity trading platform available to the NYBOT on reasonable commercial terms for the electronic trading of its products.

“This historic step ensures that the leading soft commodities exchange maintains its global leadership in its markets and its course for continued expansion,” said Frederick Schoenhut, chairman of the NYBOT. “The NYBOT and its membership believe this combination is an exceptional opportunity to capitalize on the strength of each partner to create and participate in an unparalleled commodity marketplace. We are excited about joining our unique and valuable range of liquid benchmark products with ICE’s robust marketplace, strong management team and public company structure.”

“It was essential for our future growth to partner with a rapidly expanding exchange such as ICE,” said Harry Falk, NYBOT president and CEO. “While we considered a number of qualified potential partners, we feel this agreement with ICE is the best fit for our exchange and our long-term goals. This merger provides our unique traditional markets the resources necessary to provide greater access and a higher level of service to our global users. It will allow us to continue using open-outcry trading, while providing a state-of-the-art electronic trading capability, thus giving our market participants a choice in how they wish to trade.”

The merger is expected to close in the first half of 2007. The ICE expects the transaction to be accretive within 12 to 18 months of closing, as full run-rate synergies are achieved. Based on recent results and fully realized synergies, the ICE estimates that the transaction could yield over US$50 million in total pretax synergies, consisting of a combination of pre-tax clearing synergies of approximately US$41 million, potential pre-tax income from electronic trading opportunities in excess of US$6 million and potential annual expense synergies of US$10 million.