BGC Expects to Reach Consensual Pact with GFI Group

By Angela Chen 

BGC Partners Inc. said Thursday that it expects to reach a consensual agreement to buy brokerage GFI Group Inc. for $778 million, following a monthslong bidding war with rival CME Group Inc.

BGC Chief Executive Howard Lutnick said the company has "actively engaged" in discussions with GFI and expects to reach an agreement to complete its $6.10 a share all-cash tender offer.

A representative from GFI wasn't immediately available for comment.

Shares of GFI are up about 1% in midday trading.

Last month, shareholders voted down GFI's planned sale to CME for $5.85 a share, which put the company on the clock to outrun a hostile bid from BGC.

GFI Chief Executive Mickey Gooch said at the time that the company was disappointed that the CME merger wasn't approved and it would work to find a strategic alternative to maximize the value of shareholders' investment.

BGC and CME had been locked in a bidding war over GFI since last summer. The CME deal would have seen the operator of the Chicago and New York mercantile exchanges acquire all of GFI for about $750 million and sell back the brokerage business to GFI executives.

BGC has conditioned its bid on getting two-thirds of GFI's director seats, among other things. BGC can waive that requirement, but then risks finding itself with a hefty stake and little influence.

The BGC's tender off expires Thursday.

Write to Angela Chen at [e-mail]

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