BGC Calls Its Offer for GFI Superior to CME's Raised Bid

By Angela Chen 

Global brokerage firm BGC Partners Inc. said its all-cash offer to buy GFI Group Inc. remains superior to that of rival CME Group Inc., which on Tuesday increased its cash-and-stock offer to match BGC's.

BGC and CME have been engaged in a bidding war for GFI over the past few months. Brokers such as CME, BGC and GFI act as middlemen for Wall Street's big banks.

In pushing the bid from his company, BGC Chief Executive Howard Lutnick called his offer superior and said the company has made progress in receiving necessary regulatory approval for the acquisition.

BGC has offered about $675 million, or $5.25 a share, for GFI, seeking to break up CME's plan to buy the company. BGC, the second-largest broker by market capitalization, went public with its intention to launch a tender offer for the company in September, after taking a 13.5% stake in GFI.

That offer is scheduled to expire Dec. 9 and has already been extended once after a low response rate.

GFI rejected the BGC bid last month, calling it "highly conditional," due to an impasse over issues such as board seats. At that time, the board members suggested going ahead with CME.

For its part, CME offered $4.55 a share in July but raised that offer to $5.25 a share on Tuesday.

Under the CME deal, CME would keep GFI's energy-trading platform, Trayport, and its pricing-and-data business, known as Fenics, and sell the firm's brokerage-and-clearing operation back to GFI executives.

Write to Angela Chen at [e-mail]

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