Says CME's Supposedly Enhanced Offer Has Been Raised by Less Than
the Increase in CBOT's 2007 Earnings Outlook ATLANTA, June 27
/PRNewswire-FirstCall/ -- IntercontinentalExchange, Inc. (NYSE:ICE)
today sent the following letter to Chicago Board of Trade (NYSE:
BOT) stockholders and members urging them to reject the proposed
sale to CME: June 27, 2007 DON'T BE SOLD SHORT BY YOUR BOARD AGAIN
-- STOP CME FROM BUYING CBOT ON THE CHEAP CME'S SUPPOSEDLY ENHANCED
OFFER HAS BEEN RAISED BY LESS THAN THE INCREASE IN CBOT'S 2007
EARNINGS OUTLOOK VOTE NO ON CME'S CLEARLY INFERIOR OFFER ON JULY 9
Dear Chicago Board of Trade Stockholder/Member: Your Board has
agreed to sell CBOT to CME in a transaction that significantly
undervalues your company. Rather than match ICE's higher offer, CME
has yet again low-balled you with a supposedly enhanced offer that
doesn't reflect the true value of your company -- and will be paid
for by CBOT's own improved earnings prospects. Instead of putting
their money on the table, CME has continued to wage a campaign of
low-road rhetoric in an attempt to scare you into voting for their
inferior transaction. THE CHOICE IS CLEAR: ICE HAS CONSISTENTLY
OFFERED YOU MORE VALUE FOR CBOT By voting NO on July 9th, you can
stop this inferior deal and send a message to your Board that you
want it to consider ICE's superior proposal. CME'S "INCREASED" BID
IS BEING PAID FOR BY CBOT'S OWN IMPROVING EARNINGS PROSPECTS (See
chart at http://www.theicecbot.com/) Before ICE made its competing
bid, the CBOT Board had agreed to sell your Exchange to the CME in
a transaction that was then worth $151.28 per CBOT share. Since
then, CBOT's consensus EPS estimates have risen by 25% for 2007 and
22% for 2008. Yet CME has only increased its original bid by 22%:
16% on May 11 with a higher exchange ratio, and 6% on June 14
through a contingent special dividend. And you wouldn't have gotten
even this apparent increase from the CME without ICE's superior
proposal. Over the same period, CME's 2007 and 2008 consensus EPS
estimates have increased by just 2% and 3%, respectively. It's a
sweet deal for the slow-growing CME -- but a bad deal for you. ICE
HAS A DEMONSTRABLY STRONGER CURRENCY CME has consistently tried to
talk down the value of ICE's stock by dismissing ICE's superior
growth rate and strong fundamentals. The fact is that ICE has been
growing rapidly and profitably, both organically and through
strategic acquisitions -- which is reflected in its strong share
price appreciation. Yet ICE shares continue to trade at a lower
multiple than CME which indicates future upside. The CME doesn't
want you to realize that its growth rate is lower, its multiple is
higher, and its stock is less liquid. This graph demonstrates how
ICE has created more value for stockholders than CME. Which stock
would you rather own? (See chart at http://www.theicecbot.com/) *
ICE CREATES MORE VALUE: -- Since ICE proposed to merge with CBOT in
March, CBOT shares are up by $34.33 per share, increasing value for
CBOT stockholders by $1.8 billion. -- Since going public, ICE
shares are up 460% versus only 37% for the CME over the same
period. -- ICE's stock offers greater liquidity: average dollar
volume traded in 2007 is $583 million per day for ICE vs. only $375
million per day for CME. -- In response to member requests for a
cash option, ICE enhanced its all-stock offer to include a $2.5
billion cash election. -- ICE worked with the CBOE to craft a
win-win solution to the exercise right issue - only after ICE took
this innovative action did CME attempt to copy ICE with an inferior
version of the ICE/CBOE proposal to CBOT members. * ICE HAS
CONTINUED TO DEMONSTRATE VISION & LEADERSHIP: -- Quickly and
successfully integrated the NYBOT acquisition, generating record
trading volume -- Acquired the exclusive license for Russell Index
futures -- these are longtime CME-traded products -- Partnered with
NGX to offer NGX's contracts on ICE's platform and bring NGX's
capabilities for physical settlement of energy contracts to the
U.S. -- Announced the acquisition of ChemConnect's trading business
-- Announced the acquisition of Winnipeg Commodity Exchange and its
leading canola futures product ICE's management is committed to the
success of an ICE/CBOT merger, and will apply to the combined
company the innovation and leadership that has made ICE the fastest
growing derivative exchange in the world. An ICE/CBOT combination
is an important step in creating the world's leading derivative
exchange. ICE is committed to continue innovating and creating new
markets instead of relying solely on the protection of large market
positions in developed products. INTEGRATION RISK IS A RED HERRING
-- JUDGE THE FACTS FOR YOURSELF Rather than paying you what CBOT is
worth, CME and your Board have attempted to push through their
below-market transaction by attacking an ICE/CBOT merger as risky
and a threat to your franchise and livelihood. Let's look at the
facts: * In 2006, the ICE system was available 99.99% of the time,
among the best records in the industry. * The ICE platform is
available 7 days a week, 23 hours a day. * ICE currently averages
27 milliseconds for a round-trip futures trade and expects to
improve to 7 milliseconds by August. A CME round trip averages 31
milliseconds. * Multiple distribution points make ICE the world's
most accessible trading platform. * ICE is built on new -- not
legacy -- technologies, yielding greater cost efficiencies, high
reliability, performance, speed and functionality. All at the
lowest possible cost, which is critical for competitiveness in
global markets. * The previous integration of CBOT clearing into
the CME common clearing link was complicated, but was accomplished
in only nine months. It is disingenuous of CBOT and CME to claim we
will be unable to integrate these platforms in a timely fashion.
Why would ICE jeopardize over $10 billion of market capitalization
if a merger with CBOT were truly risky? ICE's senior management has
a lot of skin in the game. We own over 2.8 million ICE shares, or
more than 4.1% of the Company, and are personally invested in the
success of ICE and a combined ICE/CBOT. Would ICE be pursuing this
combination if we were not completely confident in our ability to
integrate and grow a combined ICE/CBOT? In sharp contrast, the
combined ownership of CME by all 30 CME executive management and
Board members is 356,797 shares, or only 1.0% of CME. The CEO and
Chairman of CME together beneficially own all of 81,910 CME shares,
or just 0.2% of CME, and most of these are options. PRESERVE YOUR
RIGHT TO OBTAIN FAIR VALUE FOR YOUR EXCHANGE! VOTE "AGAINST" THE
CME/CBOT TRANSACTION If you want to protect your opportunity to
receive more value for your shares through the ICE proposal, we
urge you to reject the undervalued CBOT sale to CME. A
distinguished institution such as CBOT, its stockholders, and its
members deserve better. On behalf of the ICE Board and management
team, thank you for your continued support. Sincerely, Jeffrey C.
Sprecher Chairman and Chief Executive Officer
IntercontinentalExchange, Inc. VOTE AGAINST THE CME PROPOSAL TODAY!
Even if you have already returned a proxy you have every right to
change your vote. Only your latest dated vote will count. We urge
CBOT Stockholders to vote AGAINST the CME's below-market offer. If
you have any questions, please contact: Innisfree M&A
Incorporated Toll-Free at: (877) 800-5187 Additional Information
More information about the ICE proposal is available on the ICE
website at http://www.theice.com/ under About ICE/Investor
Relations and at http://www.theicecbot.com/. In addition, ICE will
post slides entitled "Revised Proposal to Acquire CBOT Holdings"
dated June 12, 2007 to its website under About ICE/Investor
Relations and on http://www.theicecbot.com/. About
IntercontinentalExchange IntercontinentalExchange(R) (NYSE:ICE)
operates the leading global, electronic marketplace for trading
both futures and OTC energy contracts and the leading soft
commodity exchange. ICE's markets offer access to a range of
contracts based on crude oil and refined products, natural gas,
power and emissions, as well as agricultural commodities including
cocoa, coffee, cotton, ethanol, orange juice, wood pulp and sugar,
in addition to currency and index futures and options. ICE(R)
conducts its energy futures markets through its U.K. regulated
London-based subsidiary, ICE Futures, Europe's leading energy
exchange. ICE Futures offers liquid markets in the world's leading
oil benchmarks, Brent Crude futures and West Texas Intermediate
(WTI) Crude futures, trading nearly half of the world's global
crude futures by volume of commodity traded. ICE conducts its
agricultural commodity futures and options markets through its U.S.
regulated subsidiary, the New York Board of Trade(R). For more than
a century, the NYBOT(R) has provided global markets for food, fiber
and financial products. ICE was added to the Russell 1000(R) Index
on June 30, 2006. Headquartered in Atlanta, ICE also has offices in
Calgary, Chicago, Houston, London, New York and Singapore. For more
information, please visit http://www.theice.com/ and
http://www.nybot.com/. Forward-Looking Statements - Certain
statements in this press release may contain forward-looking
information regarding IntercontinentalExchange, Inc., CBOT
Holdings, Inc., and the combined company after the completion of
the possible merger that are intended to be covered by the safe
harbor for "forward-looking statements" provided by the Private
Securities Litigation Reform Act of 1995. These statements include,
but are not limited to, statements about the benefits of the merger
transaction involving ICE and CBOT, including future strategic and
financial benefits, the plans, objectives, expectations and
intentions of ICE following the completion of the merger, and other
statements that are not historical facts. Such statements are based
upon the current beliefs and expectations of ICE's management and
are subject to significant risks and uncertainties. Actual results
may differ materially from those set forth in the forward-looking
statements. The following factors, among others, could cause actual
results to differ materially from those expressed or implied in
such forward-looking statements regarding the success of the
proposed transaction: the failure of CBOT to accept ICE's proposal
and enter into definitive agreements to effect the transaction, the
risk that the revenue opportunities, cost savings and other
anticipated synergies from the merger may not be fully realized or
may take longer to realize than expected; superior offers by third
parties; the requisite approvals provided for under the Agreement
dated May 30, 2007, as amended on June 11, 2007, by and between ICE
and the Chicago Board Options Exchange ("CBOE"), and the
performance of the obligations under such Agreement; the ability to
obtain governmental approvals and rulings on or regarding the
transaction on the proposed terms and schedule; the failure of ICE
or CBOT stockholders to approve the merger; the risk that the
businesses will not be integrated successfully; disruption from the
merger making it difficult to maintain relationships with
customers, employees or suppliers; competition and its effect on
pricing, spending and third-party relationships and revenues;
social and political conditions such as war, political unrest or
terrorism; general economic conditions and normal business
uncertainty. Additional risks and factors are identified in ICE's
filings with the Securities and Exchange Commission (the "SEC"),
including ICE's Annual Report on Form 10-K for the year ended
December 31, 2006, as filed with the SEC on February 26, 2007 and
ICE's Quarterly Report on Form 10-Q for the quarter ended March 31,
2007, as filed with the SEC on May 4, 2007. You should not place
undue reliance on forward-looking statements, which speak only as
of the date of this press release. Except for any obligations to
disclose material information under the Federal securities laws,
ICE undertakes no obligation to publicly update any forward-looking
statements to reflect events or circumstances after the date of
this press release. Important Information About the Proposed
Transaction and Where to Find It: This material relates to a
business combination transaction with CBOT proposed by ICE, which
may become the subject of a registration statement filed with the
SEC. This material is not a substitute for the joint proxy
statement/prospectus that CBOT and ICE would file with the SEC if
any agreement is reached or any other documents which ICE may send
to stockholders in connection with the proposed transaction.
INVESTORS ARE URGED TO READ THE JOINT PROXY STATEMENT/PROSPECTUS
AND ALL OTHER RELEVANT DOCUMENTS IF AND WHEN THEY BECOME AVAILABLE
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Investors will be
able to obtain a free copy of the joint proxy statement/prospectus,
if and when such document becomes available, and related documents
filed by ICE or CBOT without charge at the SEC's website
(http://www.sec.gov/). Copies of the final proxy
statement/prospectus, if and when such document becomes available
may be obtained, without charge, from ICE by directing a request to
ICE at 2100 RiverEdge Parkway, Suite 500, Atlanta, Georgia, 30328,
Attention: Investor Relations; or by emailing a request to . ICE
has filed a proxy statement in connection with the special meeting
of CBOT stockholders scheduled for July 9, 2007, at which the CBOT
stockholders will consider the CBOT merger agreement with CME and
other related matters. CBOT stockholders are strongly advised to
read this proxy statement and other related documents, as they
contain important information. Investors are able to obtain a free
copy of the proxy statement with respect to the special meeting
without charge, at the SEC's website (http://www.sec.gov/). Copies
of the proxy statement with respect to the special meeting may be
obtained, without charge, from ICE by directing a request to ICE at
2100 RiverEdge Parkway, Suite 500, Atlanta, Georgia, 30328,
Attention: Investor Relations; or by emailing a request to . This
communication shall not constitute an offer to sell or the
solicitation of an offer to buy the securities, nor shall there be
any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
No offering of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the Securities
Act of 1933, as amended. Participants in the Solicitation: In
addition to ICE, the following officers and employees of ICE will
also be participants in the foregoing proxy solicitations: Jeffrey
C. Sprecher (Chairman and Chief Executive Officer), David S. Goone
(Senior Vice President, Chief Strategic Officer) and Kelly L.
Loeffler (Vice President, Investor Relations and Corporate
Communications). You can find information about ICE and ICE's
directors and executive officers in ICE's Annual Report on Form
10-K, filed with the SEC on February 26, 2007 and in ICE's proxy
statement for its 2007 annual meeting of stockholders, filed with
the SEC on March 30, 2007. Other than 1,000 shares of CBOT Class A
Common Stock owned by ICE, neither ICE nor any of the other
participants in either of these proxy solicitations has any
interest, direct or indirect, by securities holdings or otherwise,
in CBOT Holdings, Inc. or Chicago Mercantile Exchange Holdings Inc.
None of the participants will receive any special compensation in
connection with either of these proxy solicitations. DATASOURCE:
IntercontinentalExchange, Inc. CONTACT: IntercontinentalExchange,
Kelly Loeffler, VP, Investor Relations and Corporate
Communications, +1-770-857-4726, ; Sard Verbinnen & Co, Jim
Barron or Kara Findlay, +1-212-687-8080, or Brad Wilks,
+1-312-895-4700; Crystal Clear Communications, Ellen G. Resnick,
+1-773-929-9292, +1-312-399-9295 - cell, Web site:
http://www.theice.com/ http://www.theicecbot.com/
http://www.nybot.com/
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