Nymex Ups IPO Value, Size; Other Exchanges Reap Benefits

Increasing the expected value of its initial public offering (IPO) on the New York Stock Exchange prior to its release Friday, Nymex Holdings Inc., through Securities and Exchange Commission (SEC) filings this week, said it has increased its share expectation price from between $48 to $52 to between $54 to $57, while also expanding the offering to 6.5 million shares from 6 million shares. The frenzy over Nymex's IPO has also boosted the share prices of other exchanges.

The revised offering takes the IPO's potential value from $288-312 million to $351-370 million (see Daily GPI, Nov. 13). Nymex, which operates the 134-year-old New York Mercantile Exchange, is currently held by its members (90%) and General Atlantic (10%), which bought into Nymex back in March for $160 million (see Daily GPI, March 14). At that time, Nymex said General Atlantic was the best partner to help make Nymex more valuable through a possible IPO.

In a previous SEC filing, Nymex said the principal purposes of this IPO is to "obtain additional capital, create a public market for our common stock, facilitate our future access to public equity markets and provide increased visibility in a marketplace in which a number of our current and potential competitors are or will be publicly held companies," Nymex said in its filing.

Last fall, chief Nymex competitor, the IntercontinentalExchange (ICE), launched a very successful IPO (see Daily GPI, Nov. 17, 2005). Some market watchers see Nymex's IPO as a leveling of the playing field in the commodity exchange arena.

News of the Nymex offer expansion sparked a run-up in the shares of three related exchanges, with ICE clearly the front-runner percentage-wise. ICE shares were up 9.1% -- or $8.05 -- to close Tuesday at $96.55 per share. CBOT Holdings, parent of the Chicago Board of Trade was up 3.7% -- or $5.48 -- to close at $153.02. The Chicago Mercantile Exchange was up 2.95% -- or $14.74 -- to close at $513.72.

Nymex said that other than a payment of $10 million to the owners of Comex Division memberships, Nymex has "no specific allocations for the use of proceeds from this offering" at this time. As previously reported, Nymex will be listed on the New York Stock Exchange under the symbol "NMX."

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