CBOE shares up; analyst calls Nasdaq likely suitor

CHICAGO Fri Feb 25, 2011 5:12pm EST

CHICAGO Feb 25 (Reuters) - CBOE Holdings Inc (CBOE.O) shares jumped Friday, after a Credit Suisse analyst called the U.S. options market operator a takeout candidate and fingered Nasdaq OMX Group (NDAQ.O) as its most likely suitor.

"We believe a NDAQ-CBOE combination would have strong strategic merits for both companies," Howard Chen wrote in a note to clients devoted to an analysis of such a takeover, although no such deal has been announced. Chen raised his rating on the operator of the Chicago Board Options Exchange to "outperform."

A wave of financial exchange consolidation, including a planned takeover of NYSE Euronext NYX.N by Deutsche Boerse AG (DB1Gn.DE), has spurred speculation over what other combinations could be in the offing. As the last independent North American exchange with a lineup of highly popular, profitable, and exclusively listed contracts, CBOE is "the most likely near-to-intermediate term takeout candidate," Chen wrote.

Nasdaq could also try to buy the Toronto Stock Exchange, breaking up the Canadian bourse's planned merger with the London Stock Exchange, Chen said. CME Group Inc (CME.O) could also buy Brazil's BM&F Bovespa (BVMF3.SA), with which it has a cross-shareholding arrangement, "further down the road," he wrote.

CBOE shares closed up 6.9 percent at $29.43.

(Reporting by Ann Saphir, editing by Bernard Orr)