Source: NASD in Deal to Sell Amex
Monday June 2, 9:13 am ET
By Nicole Maestri and Doris Frankel
NEW YORK/CHICAGO (Reuters) - The American Stock Exchange, the No. 3 stock exchange, is set to be sold to a Chicago-based private equity firm for $110 million, an industry source said on Monday.
Late last week, NASD, Amex's parent, signed a letter of intent to sell the exchange to GTCR Golder Rauner LLC, the source said.
No layoffs are expected as a result of the deal, which is expected to be completed in the next 30 to 60 days, the source said.
The deal is subject to approval from the U.S. Securities and Exchange Commission (News - Websites), the boards of the Amex and the NASD, and the vote of the Amex membership.
Last week, an industry source told Reuters that a subcommittee of the board of NASD gave preliminary approval to sell the exchange to GTCR, despite a recent overture from Chicago Board Options Exchange (News - Websites).
At the end of May, CBOE proposed "a strategic combination" with Amex, the No. 3 equities options exchange, to win back market share from the all-electronic International Securities Exchange, the current leader in equity options.
But the proposal from the world's largest options exchange came late in the game for the Amex, which has been on the selling block for more than two years.
NASD purchased Amex in 1998 and billed the merger as a way to lower fees for investors who could chose if they wanted their shares traded on the Amex, which uses a floor-based auction system, or the Nasdaq Stock Market (News - Websites) Inc. (OTC BB:NDAQ.OB - News), where traders compete for orders electronically.
But amid rising competition from electronic trading venues and changing market conditions, the benefits of the deal failed to materialize. In 2000, NASD began the process of spinning off Nasdaq and later, it put the Amex on the block, saying it wanted to concentrate solely on regulation. |
