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Big Online Brokers in Talks on Possible Takeovers By Andrew Ross Sorkin
A http://query.nytimes.com/search/que...t=newest&ac=ANDREW ROSS SORKIN&inline=nyt-perhttp://query.nytimes.com/search/que...t=newest&ac=ANDREW ROSS SORKIN&inline=nyt-pertakeover skirmish among three of the nation's largest online stock brokerages erupted over the weekend, potentially leading to a significant reorganization of the industry that is expected to have an impact on individual investors.
E*Trade Financial made an unsolicited bid to buy Ameritrade Holdings on Friday for more than $5.5 billion in a letter to its board, according to executives involved in the talks.
Ameritrade, meanwhile, has been holding secret negotiations to buy TD Waterhouse, the executives said.
The boards, managements and advisers of all three companies spent the weekend plotting their next moves. Competitors like Charles Schwab also spent telephone time discussing where they might fit in, executives said.
Ameritrade's shares, which are down more than 20 percent so far this year, rose 57 cents Friday, to $11.31, while E*Trade, whose stock is also down more than 20 percent, rose 93 cents, to $11.93.
Of the two companies, E*Trade has been somewhat buffered from the slump in stock trading because it has a bank that sells mortgages among other products - although that business, too, could suffer as interest rates rise.
E*Trade also owns a stock market-making business that could process trades for Ameritrade's customers, were the two businesses to combine, said Charlotte Chamberlain, an analyst at the broker Jefferies & Company.
A merger between E*Trade and Ameritrade would place more pressure on Charles Schwab. The company, long an industry giant, has shaken up its management and cut commissions several times over the last few months in an effort to regain ground lost in recent years to smaller, more nimble competitors like E*Trade and Ameritrade.
Big Online Brokers in Talks on Possible Takeovers By Andrew Ross Sorkin
A http://query.nytimes.com/search/que...t=newest&ac=ANDREW ROSS SORKIN&inline=nyt-perhttp://query.nytimes.com/search/que...t=newest&ac=ANDREW ROSS SORKIN&inline=nyt-pertakeover skirmish among three of the nation's largest online stock brokerages erupted over the weekend, potentially leading to a significant reorganization of the industry that is expected to have an impact on individual investors.
E*Trade Financial made an unsolicited bid to buy Ameritrade Holdings on Friday for more than $5.5 billion in a letter to its board, according to executives involved in the talks.
Ameritrade, meanwhile, has been holding secret negotiations to buy TD Waterhouse, the executives said.
The boards, managements and advisers of all three companies spent the weekend plotting their next moves. Competitors like Charles Schwab also spent telephone time discussing where they might fit in, executives said.
Ameritrade's shares, which are down more than 20 percent so far this year, rose 57 cents Friday, to $11.31, while E*Trade, whose stock is also down more than 20 percent, rose 93 cents, to $11.93.
Of the two companies, E*Trade has been somewhat buffered from the slump in stock trading because it has a bank that sells mortgages among other products - although that business, too, could suffer as interest rates rise.
E*Trade also owns a stock market-making business that could process trades for Ameritrade's customers, were the two businesses to combine, said Charlotte Chamberlain, an analyst at the broker Jefferies & Company.
A merger between E*Trade and Ameritrade would place more pressure on Charles Schwab. The company, long an industry giant, has shaken up its management and cut commissions several times over the last few months in an effort to regain ground lost in recent years to smaller, more nimble competitors like E*Trade and Ameritrade.
