(Corrects CBOE name in first graph to delete the word "group")
* Nasdaq's going-private talks put option on radar: Tilly
* CBOE shares rise 2.3 pct, hitting highest since 2010 IPO
By Ann Saphir
Feb 14 CBOE Holdings Inc, which became
a publicly held company in 2010 after years of effort, would
consider going private again if doing so benefits its
shareholders, a top executive said on Thursday.
Before revelations earlier this week that private equity
firm Carlyle Group had approached Nasdaq OMX Group Inc
about taking the exchange operator private, doing so "would not
have been a logical exploratory change in governance and
ownership structure," CBOE's Chief Operating Officer Edward
Tilly told a Credit Suisse financial services forum.
But now that news of the talks has put the possibility on
the radar screen, "We still must act and are looking forward to
acting in the best interest of our stockholders," he said. "If
valuations as a result of conversations with Carlyle lift all
boats, so be it ... We would have to entertain changes in our
CBOE shares hit a record high, rising 2.3 percent to $35.80
on the Nasdaq Stock Market.
CBOE Chief Executive Bill Brodsky waged a years-long
campaign to convert CBOE from a private club run by its members
to a public company run for profit. Reversing that hard-won
victory seems an unlikely step for Tilly, who is in line to take
over as CEO in May.
Going public allowed CBOE for the first time in its nearly
40-year history to make strategic decisions without the
cumbersome process of consulting hundreds of members, and to
better compete in the crowded field of U.S. stock-options
"We are getting into a nice rhythm as a public company,"
said Tilly, who joked that he would not have had the chance to
leave Chicago's cold winter to speak at the investor forum,
taking place in warm Miami if CBOE was a private company.
Tilly's comments fell short of suggesting he is eager to
take the exchange private, and a CBOE spokeswoman declined to
comment on whether the company has engaged in any go-private
But he left the door open to the possibility in a way that
the chief of Chicago's other major exchange operator, in remarks
to the same forum on Tuesday, did not.
CME CEO Phupinder Gill said he did not see "the advantage of
going private at this time."
"I do have a sense that something is happening with CBOE,
because the stock has just been bit by bit clawing its way
forward," said Thomas Caldwell, chairman of Toronto's Caldwell
Securities and the owner of about 1.8 million CBOE shares.
Citing the regulatory expense of being a public U.S.
company, and noting that other firms, including struggling
computer company Dell Inc have moved to go private, Caldwell
said he could understand the move from a cost perspective.
"And it would also drag any potential suitor who was lurking
in the bushes, out," he added.
The talks between Carlyle and Nasdaq fell apart over a
disagreement on price, sources told Reuters on Monday.
CBOE would need to see an offer of $38 to $40 a share in
order to get investors to tender their stock, Caldwell said.
"If (Tilly) plans go private at an exorbitant price I am
wildly in favor," Caldwell said. "I certainly can understand it,
given the costs and pitfalls of being a public company."
(Reporting by Ann Saphir; Editing by Gerald E. McCormick,