Nymex Holdings (NYSE:NMX) shares are trading up strongly in early morning hours after the energy futures company admitted to preliminary buyout talks but could not guarantee that the talks would result in a sale of the company. Many shareholders have been anticipating further consolidation and this move by Nymex only confirms the strength of M&A in the exchanges market.

News of the possible buyout came after the company's chairman and chief executive held a meeting with analysts in which they admitted talks were in progress. After the research note was published by analysts, the company quickly confirmed the note with their own statement:

"Since discussions have been preliminary, there can be no assurance that the company will enter into any transaction ... although the chairman indicated his belief that any transaction would have to be at a meaningful premium to the company's current share price."

Rumors have also been circulating that the company could be a target of NYSE-Euronext whose chief executive said not long ago was looking for potential acquisitions to increase its foothold in the futures business. Whether or not this is the bidder remains unclear; however, we definitely know there are potential bidders with deep pockets.

The statement also suggested that the company could benefit from $250 million in cost savings in addition to revenue gains from a European expansion and new product lines. The company is also working internally on methods to cut costs and reduce expenses to increase its earnings per share and jump its stock price.
 Regardless, this is definitely a stock to watching moving forward!

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