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FERRUZZI ANNOUNCES SETTLEMENT WITH CBOT BOARD; FERRUZZI EXONERATED ON MANIPULATION CHARGES

 FERRUZZI ANNOUNCES SETTLEMENT WITH CBOT BOARD;
 FERRUZZI EXONERATED ON MANIPULATION CHARGES
 CHICAGO, Jan. 10 /PRNewswire/ -- The Ferruzzi Group today announced a settlement with the Chicago Board of Trade under which the major disciplinary charges of attempted market manipulation and attempted cornering against Ferruzzi have been dismissed.
 The settlement relates to the July 1989 soybean futures contract. It comes after a preliminary hearing late in 1990 by the CBOT's disciplinary arm, the Business Conduct Committee (BCC), but before a decision by the full CBOT Board of Directors.
 The settlement contains no findings or conclusions against Ferruzzi, nor any admission of wrongdoing by any Ferruzzi companies. As part of the settlement, the CBOT has dismissed entirely the charges of attempted market manipulation and attempted cornering of the market against Ferruzzi. Earlier, following its 1990 hearing, the BCC itself dismissed the preliminary charges of actual market manipulation and market demoralization before referring the matter to the CBOT Board.
 As part of the settlement, Ferruzzi agreed to drop its lawsuit against the CBOT and the CBOT agreed to drop all claims against Ferruzzi arising from the events of July 1989.
 Under the settlement terms, the Ferruzzi Group agreed to the entry of a cease and desist order related to certain trading rules. Ferruzzi and Central Soya will pay the CBOT $2 million plus certain legal costs.
 In addition, Ferruzzi Finanziaria has decided to resign as a member company of the CBOT and to transfer with the CBOT's consent its seat to Central Soya Company, Inc., the Ferruzzi Group company principally involved in commodities operations in North America, which already holds six seats. Central Soya will continue as a member company of the CBOT and as a member of the CBOT Clearing Corporation.
 "As an international commodities grower, trader and processor, Ferruzzi depends upon the CBOT in its role as the world's leading reference market," said David Swanson, a member of the Ferruzzi Group's strategic committee and president and chief executive officer of Central Soya. "With this settlement, we are able to end a costly, two-and-a- half-year-old dispute and to re-establish a positive relationship with the board.
 "The settlement vindicates the Group and clears it of allegations that it was in any way trying to influence the market," said Swanson.
 Swanson added that the resignation of Ferruzzi Finanziaria would not affect Central Soya or the Group's trading operations, nor their collective role as one of the world's leading exporters of U.S. grain. "We will remain a leading buyer, processor and trader of the crops grown by America's farmers," Swanson said.
 "The amount paid and other settlement terms are of little consequence, when weighed against our desire to work productively with the CBOT, the effort already spent on this matter and the possibility of a long, expensive administrative review and appeals process," Swanson said.
 The July 1989 soybean contract came to public attention on July 11, 1989, when the CBOT issued an emergency order requiring liquidation of all market participants' positions.
 Following the order, the CBOT launched an inquiry into Ferruzzi's activities. The BCC brought administrative charges against Ferruzzi on July 27, 1990, and hearings started Sept. 17, 1990.
 In the settlement announced Jan. 10, 1992, Ferruzzi and Central Soya also agreed to accept an order to cease and desist from any violation of CBOT Rule 506.00 (reckless and unbusinesslike dealing), Rule 500.00 (inequitable proceedings), Rule 504.00 (acts detrimental to the welfare of the exchange), Regulation 425.01 (a) (position limits), and procedural rules relating to the hearing before the Business Conduct Committee. Charges of violations of Rules 509.00 (A) (c) 500.00 and 504.00 (attempt to manipulate the market) and Rule 509 (a) (a), (attempt to corner the market) were dismissed entirely.
 "With the issue of Ferruzzi's own activities in the July 1989 contract settled," Swanson said, "Ferruzzi will focus its attention in support of strengthening the CBOT.
 "The CBOT already has taken steps to strengthen its agricultural markets by adding delivery points to the present system and by expanding membership on the CBOT Board of Directors to include more production, trading and processing industry representatives," said Swanson.
 "These steps, while very positive, must be continued in a global context. It is in both market participants' and the board's interests that all parties be treated in an objective, even-handed manner.
 "Ferruzzi highly esteems the CBOT and we look forward to working as part of the exchange in the future," Swanson said.
 The Ferruzzi Group is a leading international industrial system which operates through Montedison in the chemical, pharmaceutical and energy sectors, as well as in the agro-industrial sector, with consolidated sales of more than $15 billion.
 -0- 1/10/92
 /CONTACT: Larry Friedman of Hill and Knowlton, 212-697-5600 or 212-210-8330, or home, 718-454-6997, for Ferruzzi/ CO: Ferruzzi Group; Chicago Board of Trade ST: Illinois IN: CHM SU:


KD -- NY061 -- 8742 01/10/92 16:19 EST
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Date:Jan 10, 1992
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