TSX Group and Montreal Exchange join forces to create TMX Group

- Combination creates an integrated, multi-asset class exchange group

- Combination strengthens Montreal's position as the Canadian centre for derivatives expertise

- MX shareholders to receive 0.5 of a common share of TSX Group and $13.95 in cash, after the effect of full proration

- Represents $39.00 in value per MX common share based on the November 28, 2007 unaffected price of TSX Group common shares

- Represents $42.56 in value per MX common share based on the December 7, 2007 closing price of TSX Group common shares

- MX Board of Directors recommends that MX shareholders vote in favour of the combination

Montreal Exchange Inc. (MX) and TSX Group Inc. (TSX Group) today announced that they have agreed to combine their organizations to create TMX Group Inc. (TMX Group), a leading integrated exchange group.

"This combination grows out of a common vision for the future of the Canadian capital markets. Customers in Canada and internationally will benefit from increased liquidity levels, accelerated product development, a fully diversified product suite, and superior technology," said Richard Nesbitt, Chief Executive Officer of TSX Group. Luc Bertrand, President and Chief executive Officer of the Montreal Exchange continued, "The new group will redefine the Canadian capital markets and strengthen its global positioning. TMX Group will list, trade, clear and offer market data for both cash and derivatives markets across multiple asset classes."

"We are creating a new exchange group that builds on the respective strengths and successes of both organizations," said Mr. Bertrand. "I amenthusiastic about the future of the derivatives markets that Montreal Exchange has been building for many years. Through this agreement, Montr?al will remain the centre of Canada's derivatives markets."

"The combination is an important milestone in the development of the Canadian capital markets, delivering benefits to all market participants and the shareholders of both organizations," said Mr. Nesbitt. "We believe that an integrated national exchange is the optimal solution to meet the evolving requirements of our broader customer base."

The head office of TMX Group will be located in Toronto. The Board of Directors, with 18 members initially, will be chaired by Wayne Fox, thecurrent chair of TSX Group. It will include five MX designated board members,including Mr. Bertrand. The agreement requires that 25% of the directors of TMX Group be residents of Quebec.

The head office of MX and the derivatives trading and related product operations will remain in Montreal. The Canadian Derivatives ClearingCorporation (CDCC) will expand its clearing mandate and continue to have its head office in Montreal. MX will also continue to manage the Montreal Climate Exchange as it develops into a leading market for exchange traded environmental products in Canada. The Autorite des marches financiers (AMF)will continue as the lead regulator for MX's operations. TMX Group will remain

Under the terms of the agreement, Mr. Nesbitt will be the Chief Executive Officer and Mr. Bertrand will be the Deputy Chief Executive Officer ofTMX Group. Mr. Bertrand will continue in his role as President and Chief Executive Officer of MX. He will also assume responsibility for information technology of the TMX Group.

Compelling Strategic Rationale for the Combination

The combination of TSX Group and MX will create a leading exchange group encompassing multiple asset classes and comprising a broad range of cash andderivatives operations. By bringing together their respective knowledgeable and experienced teams, TMX Group will have the resources and scale to develop and successfully market new capital markets products, high value data services and to offer an integrated clearing solution to an enlarged and international customer base. Furthermore, TMX Group expects strong prospects for growthoutside of Canada, particularly in the U.S. via MX's interest in Boston Options Exchange (BOX), to which TMX Group is strongly committed. This willplace TMX Group in the best position to compete in today's rapidly evolving

As an integrated exchange, MX offers trading and clearing of standardized financial derivatives products on its proprietary technology platform both inCanada and abroad, including through its significant ownership interest in BOX. MX's trading volume in its core markets grew at a compound annual growthrate (CAGR) of 29% from 2002 to 2006. MX's product portfolio is fully complementary to that of TSX Group, and with the combination, TSX Group isinvesting in a high growth business while further diversifying its revenue base.

TSX Group owns and operates Canada's pre-eminent equity markets that list more mining and oil & gas issuers globally than any other exchange group.Trading volume of the 3,942 issuers listed on its equity exchanges grew at a CAGR of 21% from 2002 to 2006. TSX Group also owns Natural Gas Exchange, a leading North American exchange for the trading and clearing of natural gas

The combination is expected to create significant value for TSX Group and MX shareholders through TMX Group's enhanced growth profile and opportunity to realize meaningful synergies. Cost synergies of $25 million per annum are targeted. These synergies are expected to be achieved through optimizing technology platforms, rationalizing premises and data centres and reducing

"The transaction will result in a fully integrated marketplace creating a strong platform from which to continue our international expansion strategy," said Wayne Fox, Chair of TSX Group. "We look forward to building on Montreal Exchange's success and to contributing to the continued growth of Montreal's financial sector."

"The MX Board of Directors has approved entering into this transaction and recommends that MX shareholders vote in favour of the combination," saidJean Turmel, Chairman of the Montreal Exchange. The agreement we have reached delivers significant shareholder value and will enhance Montreal's position in the national and global derivatives business."

Terms of the Agreement

MX and TSX Group have entered into a combination agreement (Agreement)pursuant to which TSX Group will indirectly acquire all of MX's outstandingcommon shares for total consideration of 15.3 million TSX Group common shares and $428 million in cash.

Under the terms of the Agreement, MX shareholders will receive, at the election of each holder:

- 0.7784 of a common share of TSX Group (the equivalent of $39.00 as at the market close on November 28, 2007, being the last business day prior to the confirmation of combination discussions by both companies), or

- $39.00 in cash,for each common share of MX, subject in each case, to proration.

After the effect of full proration, each MX shareholder will be entitled to receive 0.5 of a common share of TSX Group and $13.95 in cash.

Those directors and officers of MX who hold approximately 7.0% of MX common shares outstanding, have irrevocably agreed to vote their shares infavour of the amalgamation.

Financial Parameters of the Arrangement

TSX Group plans to satisfy the cash portion of the purchase price and other transaction-related capital management initiatives through:

- available cash on hand, and

- a three-year $430 million term facility and a three-year $50 million revolving credit facility underwritten by BMO Capital Markets and Caisse Centrale Desjardins.

With this financing plan, TMX Group will move to a more efficient capital structure. Additionally, TMX Group may continue to make purchases under itsexisting normal course issuer bid (NCIB) and may, at its expiry, renew its NCIB to permit the repurchase of up to 10% of its pro forma common shares,subject to market circumstances and applicable regulatory requirements.

In connection with TSX Group's existing NCIB announced on August 1, 2007,TSX Group will be terminating its pre-defined plan with its appointed broker that permits TSX Group to repurchase its common shares at times when TSX Group

The combination is expected to be accretive to earnings per share before transaction amortization in 2009, provided the company repurchases the maximumnumber of common shares available under the NCIB.

Transaction Process

The combination will be effected by way of an amalgamation of MX with an indirect wholly-owned subsidiary of TSX Group under Part1A of the CompaniesAct (Quebec), requiring the approval of two-thirds of the votes cast by the shareholders of MX. A special meeting will be held to consider the amalgamation on or about February 13, 2008. The combination will also be subject to any required minority approvals under securities laws and to regulatory approvals, including approvals of the AMF, the Competition Bureau,Toronto Stock Exchange, the United States Securities and Exchange Commission and to certain other customary conditions for an agreement of this nature.

The amalgamation is expected to close in the first quarter of 2008. At the time of its next annual shareholders' meeting, TSX Group Inc. will propose changing its name to TMX Group Inc.

Other Transaction Terms

MX has agreed to pay TSX a termination fee of $46 million in certain circumstances if the amalgamation is not completed. The Agreement includescustomary non-solicitation and right to match provisions. Full details of the amalgamation will be included in an information circular which will be mailed to MX shareholders on or about January 14, 2008.

Financial and Legal Advisors

BMO Capital Markets and Desjardins Securities acted as financial advisors to TSX Group. In addition, TSX Group's Board of Directors received fairnessopinions from the company's financial advisors that the consideration to be provided under the amalgamation is fair from a financial point of view to TSX Group. UBS Securities acted as strategic advisor to TSX Group with respect

Citigroup Global Markets and National Bank Financial acted as financial advisors to MX. In addition, MX's Board of Directors received fairness opinions from the company's financial advisors that the consideration to be received under the amalgamation is fair from a financial point of view to MX shareholders.

Davies Ward Phillips & Vineberg acted as legal counsel to TSX Group and Ogilvy Renault acted as legal counsel to MX. Cleary Gottlieb Steen & Hamiltonacted as U.S. counsel to TSX Group.

Non-GAAP Financial Measures

Earnings per share (EPS) before transaction amortization does not have astandardized meaning as prescribed by Canadian GAAP and is therefore unlikely to be comparable to similar measures presented by other issuers. We maypresent this measure in order to quantify the impact of combining TSX Group with MX on financial performance and cash flows. Management will use this measure to assess the effectiveness of combining organizations to serve customers and grow our business.

Forward-Looking Statements, Risks and Uncertainties

This press release contains forward-looking statements, which are not historical facts but are based on certain assumptions and reflect our current expectations. These statements relate to, among other things, anticipated financial performance, business prospects, strategies, regulatory developments, new services, market forces, commitments, synergies, and technological developments. Forward-looking statements are typically identified by words such as "believe", "plan", "outlook", "anticipate",

This news release does not constitute an offer to sell or the solicitation of an offer to buy any securities of TSX Group. Such an offer may only be made pursuant to a management information circular fil d with or furnished to the securities regulatory authorities in Canada and the United States in connection with the proposed amalgamation. MX plans to file a management information circular with Canadian provincial securities regulators and TSX Group intends to file a registration statement with the United States Securities and Exchange Commission ("SEC") which will include the management information circular or to furnish the management information circular to the SEC pursuant to an exemption from registration. Investors and security holders are urged to read the management information circular regarding the proposed business combination when this document becomes available because it will contain important information in respect of the proposed transaction.Investors may obtain a free copy of the management information circular when it becomes available on SEDAR at www.sedar.com and a free copy of the registration statement and/or the management information circular when it becomes available on the SEC's website at www.sec.gov. The management information circular may also be obtained for free, once it has been mailed to MX shareholders, on MX's website www.m-x.ca or by directing a request to MX.

About TSX Group Inc.

TSX Group operates Canada's two national stock exchanges, Toronto Stock Exchange serving the senior equity market and TSX Venture Exchange serving thepublic venture equity market, NGX, a leading North American exchange for the trading and clearing of natural gas and electricity contracts and Shorcan, the country's first fixed income inter-dealer broker. TSX Group also owns Equicom, a leading provider of investor relations and related corporate communication services in Canada. TSX Group is headquartered in Toronto and maintains offices in Montreal, Winnipeg, Calgary and Vancouver.

About Montreal Exchange Inc.

MX is the Canadian derivatives exchange. MX offers trading in Canadian interest rate, index and equity derivatives. Clearing, settlement and risk management services are provided by an AA rated clearing house, the Canadian Derivatives Clearing Corporation, fully owned by the MX. MX's integrated trading and clearing services are supported by a proprietary suite of exchange technologies, known as SOLA(R). MX also has interests in: the Boston OptionsExchange (BOX), a U.S. automated equity options market, for which MX is the technical operator; the Canadian Resources Exchange (CAREX), a new corporation created with NYMEX that is dedicated to developing the Canadian energy market; and the Montr?al Climate Exchange (MCeX), a joint venture with the Chicago Climate Exchange(R), aiming to establish the leading market for publicly traded environmental products in Canada.

Teleconference/Audio Webcast

MX and TSX Group will host a teleconference / audio webcast to discuss the transaction

Investor Conference Call

------------------------

December 10 at 8:30 a.m.: Financial analysts' teleconference.

In English: 514 861-4190

1-800-952-4972 (toll-free in North America)

In French: 514 861-1531

(simultaneous translation) 1-877-461-2815 (toll-free in North America)

Replay:

A replay will be available until Monday,

December 17, 2007. To access the replay,

please dial 514 861-2272 or 1-800-408-3053.

For English, enter passcode 3245469 followed by the number sign.

For French, enter passcode 3245470 followed by the number sign.

Media Conference Call

---------------------

December 10 at 10:00 a.m.: Media teleconference.

In English: 514 861-1681

1-866-225-0198 (toll-free in North America)

In French: 514 861-4190

(simultaneous translation) 1-877-667-7766 (toll-free in North America)

Replay:

A replay will be available until Monday,

December 17, 2007. To access the replay,

please dial 514 861-2272 or 1-800-408-3053.

For English, enter passcode 3245472 followed

by the number sign.

For French, enter passcode 3245474 followed

by the number sign.

These teleconferences will be Webcast live and archived for 90 days on

the MX website: www.m-x.ca as well as the TSX website: www.tsx.com.

The WEB links are :

8:30 a.m.

English:

http://events.startcast.com/events/launch.asp?EventID(equal sign)

7637FD19-6074-4BE8-9E39-836A0350C82E

or

http://events.startcast.com/events/206/B0015

French:

http://events.startcast.com/events/launch.asp?EventID(equal sign)

A808A49A-01DD-4610-92D6-AC9CDE538A80

or

http://events.startcast.com/events/206/B0016

10:00 a.m.

English:

http://events.startcast.com/events/launch.asp?EventID(equal sign)

D8117E03-9D8C-4E6B-AE16-54A7561D80E6

or

http://events.startcast.com/events/206/B0017

French:

http://events.startcast.com/events/launch.asp?EventID(equal sign)

63A14546-75ED-42AF-A5B1-B20C2BBBFC1A

or

http://events.startcast.com/events/206/B0018

CONTACT: Steve Kee, Director, Corporate Communications, TSX Group

(416) 947-4682, steve.kee(at)tsx.com;

Paul Malcolmson, Director, Investor and Public Relations, TSX Group,

(416) 947-4317, paul.malcolmson(at)tsx.com;

JeanCharles Robillard, Director, Investor Relations and Communications, Montreal Exchange,

(514) 871-3551, jcrobillard(at)m-x.

SOURCE: TSX Group Inc.; Toronto Stock Exchange; TSX Corporate Announcements; Montreal Exchange Inc.

--Distributed by AsiaNet ( www.asianetnews.net )--

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