Cboe Global Markets CEO’s exit after board probe stokes talk of a sale

The Chicago-based options exchange owner said Ed Tilly “did not disclose” relationships with colleagues as it names his successors as chairman and CEO.

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Headshot of Ed Tilly, former chairman and CEO of Cboe Global Markets.

Ed Tilly, former chairman and CEO of Cboe Global Markets


What Ed Tilly did to merit his sudden departure as chairman and CEO of Cboe Global Markets appears to have been serious.

“They struck hard and they struck fast,” whatever was learned, an exchange expert said.

Tilly resigned from his post at Cboe, the nation’s leading market for options trading, following a month-long board investigation of his conduct, the company said. In its announcement Tuesday, the company said the probe turned up multiple cases of wrongdoing unrelated to finances.

“The Board of Directors determined that Mr. Tilly did not disclose personal relationships with colleagues, which violated Cboe’s policies and stands in stark contrast to the company’s values. The conduct was not related to and does not impact the company’s strategy, financial performance, technology and market operations, reporting, or internal controls,” Cboe said.

It marked a swift career end for someone affiliated with Cboe and its largest operating unit, the Chicago Board Options Exchange, for most of its 50-year history. Tilly, 60, started as a floor clerk in 1987 and rose through the ranks with the mentorship of former chairman and CEO William Brodsky.

Cboe is a publicly traded company but in the days when members owned it, Tilly once held its highest member-elected position. He became CEO in 2013 and chairman in 2017.

His departure will cost him. A company filing said that while Tilly is entitled to salary and stock options earned through the date of his exit, he will forfeit severance with an estimated value of $8.8 million, plus future stock awards.

Cboe has been the subject of acquisition rumors because of consolidation in the exchange business. The switch at the top caused analysts to revive that talk, and company shares initially gained more than 4% on the news before dropping slightly.

Tilly’s successor is not a longtime Cboe underling but Frederic Tomczyk, 68, former CEO of TD Ameritrade, analysts noted. Tomczyk joined Cboe’s board in 2019.

The company said Tomczyk will get an annual base salary of $1 million and a bonus targeted at 165% of the salary. He’ll also get deferred stock awards with a potential value of $7.15 million, according to a regulatory filing.

John Lothian, publisher of a newsletter covering the futures markets, said in an online post, “If the market is right, Fred Tomczyk won’t have to worry about fitting into Tilly’s shoes for very long. Right now, the Cboe looks like bait for another player. Maybe another Chicago institution led by a former floor trader will finally leave the docks and go fishing.”

The last line was a reference to Chicago futures market CME Group, chaired by Terrence Duffy. But a source familiar with management at both exchanges said no such deal is in the offing.

In 2021, the Financial Times reported CME had made an offer to buy Cboe. But within minutes of its story hitting the wires, CME insisted no discussions had occurred.

Cboe said it named William Farrow III, currently its lead director, as non-executive chairman. Farrow has been on the Cboe board since 2016 and formerly ran Urban Partnership Bank in Chicago. He also served as chief information officer at the Chicago Board of Trade, now part of CME.

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