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Contributors: Douglas McIntyre Jon C. Ogg

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Monday, July 17, 2006

Anyone Notice the NYMEX IPO Filing?

If we weren't watching for headlines on the escalating violence and fighting in the Middle East, we would all be discussing the fact that NYMEX filed for an IPO.

The New York Mercantile Exchange filed for an IPO to raise up to $250 million under the proposed ticker "NMX." For the three months ended March 31, the company earned $33.6 million on $140.4 million revenues. For the year-earlier period, the company earned $12.4 million on $79.2 million of total revenues.

Oil trading is a large portion of the revenues for NYMEX. It is not exactly known how much the higher oil trading and higher oil prices have helped the exchange as far as the bottom line, so this IPO could be treated a little differently than other exchanges that have come public.

The NYMEX will pay $10 million of the net proceeds from the IPO to the owners of Comex division memberships, as required by the Comex 1994 merger agreement. It also may use a portion of the proceeds to acquire or invest in businesses, technologies, products or services.

They also announced on February 7 that the board of directors approved revisions to the definitive agreement by which General Atlantic LLC (GA) would invest in a 10% equity stake in NYMEX. Under the revised terms of the transaction, GA would invest $160 million for a 10% equity position in NYMEX, valuing NYMEX’s equity at $1.6 billion on a post-investment basis. That should help to better draw comparative values toother exchanges, but the spike in oil-related and energy trading could be a wildcard. Stay tuned for this IPO.

The listed joint book runners are J.P.Morgan and Merrill Lynch, with Bank of America, Citigroup, Lehman, and Sandler O'Neill listed as co-managers.

If you wish to read prior stories we have posted on this and other exchanges, see the links below.

You can access the 4/28/06 "Ramifications of the NASDAQ & NYSE Stock Offerings; and Thoughts on the Coming Land Grab in Global Exchanges" story at the LINK HERE.

You can access the 5/19/06 " IPO Alert: Intercontinental Exchange (ICE)" story at the LINK HERE.

Jon C. Ogg
July 17, 2006
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