Regulators clear CME-CBOT merger

The US Department of Justice has approved the takeover of the Chicago Board of Trade by the Chicago Mercantile Exchange, saying it was "not likely to substantially reduce competition".

The merger had been cast into doubt by a rival bid from the Atlanta-based IntercontinentalExchange (Ice), which had suggested that combining the two Chicago bourses would significantly reduce competition. But the regulator said the two exchanges "seldom compete head-to-head".

The most important competition for the exchanges is the over-the-counter (OTC) market, which will persist – OTC competition and customer demand were more important than competition between exchanges in maintaining innovation, the department added.

Although CME shares rose slightly after the announcement, the Ice bid is still worth more, valuing CBOT shares at $211.85 in Ice stock at closing prices, against $194.97 in CME stock in the CME offer.