IntercontinentalExchange Inc. (ICE), an electronic marketplace for commodities, said Thursday it plans to buy the New York Board of Trade for about $1 billion in cash and stock.

ICE said it had a definitive agreement with NYBOT, the world's largest marketplace for futures and options on commodities such as sugar, cotton, coffee and cocoa.

NYBOT, a largely floor-based exchange with open-outcry trading, has been exploring potential buyers and other options for some time. In April, it announced it had hired an investment bank to help.

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"It was essential for our future growth to partner with a rapidly expanding exchange such as ICE," Harry Falk, president and chief executive of NYBOT, said in a release. "It will allow us to continue using open-outcry trading, while providing a state-of-the-art electronic trading capability, thus giving our market participants a choice in how they wish to trade."

Atlanta-based ICE is paying 10.3 million of its shares and $400 million in cash for NYBOT.

ICE shares fell 9 cents to close Thursday at $64.63 on the NYSE, before the deal was announced.

The deal requires approval from NYBOT's approximately 970 members, who also own the nonprofit exchange. A membership sold recently for $800,000, implying a market value for the exchange of about $775 million.

Under the terms of the deal, members must keep 30 percent of the ICE stock received for each seat to keep their floor trading rights.

In a similar deal, the member-owned New York Stock Exchange became a public company in March through a merger with electronic trading company Archipelago Holdings Inc.

However, the members of the NYSE ended up with a majority of the shares of NYSE Group (NYX). ICE expects NYBOT members to own 15 percent of the company after the deal is completed in the first half of next year. Two directors from the current NYBOT board will join the ICE board.

"The combination of two global and rapidly growing commodity marketplaces, together with a highly respected clearinghouse, allows us to expand ICE's offerings for market participants, as well as create long-term shareholder value," ICE Chairman and CEO Jeffrey C. Sprecher said.

NYBOT traces its origins back to the New York Cotton Exchange, which opened in 1870.

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