New York Mercantile Exchange, Inc. (NYMEX) is owned by CME Group (CME), Tatweer Dubai LLC (Tatweer) is owned by Dubai Holding and Eagle Commodities Limited is owned by the Oman Investment Authority.

As a result of the Proposed Transaction, the Group will invest indirectly in Dubai Mercantile Exchange Limited (DME), which is owned by DME Holdings Limited, and regulated by the Dubai Financial Services Authority. In addition, the Group will become the joint largest shareholder alongside CME.

The shares acquired represent a combination of new and existing shares. The proceeds from the new shares will be used to fund DME’s growth.

As part of the Agreement, the Group has the opportunity to obtain majority control after the fourth year during a certain agreed time period. In addition, the Agreement allows for the existing shareholders to put their shares to the Group after four years during certain agreed time periods.

As part of the Proposed Transaction terms, “Dubai Mercantile Exchange” will be rebranded as the “Gulf Mercantile Exchange“ to reflect its position as a regional commodities exchange with global relevance.

DME Holdings Limited and its existing following shareholders (Sellers):

1. Eagle Commodities Limited

2. New York Mercantile Exchange, Inc.

3. Tatweer Dubai LLC

In addition, DME is the premier energy-focused commodities exchange east of the Suez and the home of the Oman Crude Oil Futures Contract (the DME Oman Contract), that generates the world’s largest amount of physically delivered crude oil. The DME Oman Contract serves as the third-most important crude oil benchmark globally.

Through the DME’s DME Oman Contract physical delivery volumes reached 210 million barrels of oil in 2023, up from 181 million in 2022.

A total of 20 billion barrels of Omani crude oil have traded DME since inception in June 2007, while 3 billion barrels have been delivered via its physical delivery mechanism over the same period.

All trades executed on DME are cleared through CME Clearing, which is regulated by the U.S. Commodity Futures Trading Commission (CFTC).

The Proposed Transaction will support a strategic move towards leveraging the Middle East’s geographic proximity to both key commodity production hubs and end-markets.

The Proposed Transaction aligned with the Group’s growth strategy and ambitions which will contributes to the Group’s diversification as part of its strategic plan. The partnership will unlock further opportunities in the energy, metals, and agricultural commodity markets and support the ongoing transition to a sustainable economy through the launch of next-generation derivative contracts.

The Group will become the joint largest shareholder in DME Holdings Limited alongside CME, with other shareholders including the Oman Investment Authority and Dubai Holding as well as global financial and commercial industry leaders.

CME will continue to provide its industry-leading trading technology and clearing services to DME.

It is important to note that no Saudi Arabian crude oil contract will be traded, sold or bought on, or indexed to, nor will Saudi crude be delivered against, the DME Oman Contract via DME.

The Group appointed Rothschild & Co as financial advisor for the Proposed Transaction. In addition, AS&H Clifford Chance acted as legal advisor and Deloitte Middle East acted as financial and tax due diligence and accounting advisor.