After a nearly two-month delay, a Delaware judge entered an order approving the settlement of a long-running dispute between the Chicago Board Options Exchange and the Chicago Board of Trade, moving the options exchange closer to joining its competitors as a shares-based company.
The entry of a “final implementing order” starts a 30-day period in which any appeals must be filed, CBOE Chairman William Brodsky told members in a memo Wednesday. The judge initially approved the settlement in early June. The deadline for appeals is Aug. 28.
The exchanges have been battling in court for almost three years over whether Board of Trade members, whose exchange CME Group Inc. bought in 2007, are entitled to a stake in CBOE. The settlement, which gives certain Board of Trade members an 18% stake in CBOE and $300 million in cash, paves the way for CBOE to strike a deal with another exchange or to hold an initial public offering.
Those options weren’t open to CBOE without the settlement.
The dispute between the exchanges dates to 1973, when CBOT members funded the start-up options market, giving themselves the right to trade there.
CBOT members and the Board of Trade sued CBOE in August 2006, arguing that the trading rights also conferred equity ownership in the options exchange.
CME Group has bankrolled the lawsuit since it bought the CBOT.
The dispute raised enough questions about who really owned the CBOE that it kept the options market from pursuing an IPO or merging with another exchange.
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