Nasdaq's Instinet acquisition complete
Thu Dec 8, 2005 3:39 PM ET
NEW YORK (Reuters) - Nasdaq Stock Market Inc. (NDAQ.O: Quote, Profile, Research) on Thursday said its acquisition of the Inet platform of electronic brokerage Instinet Group Inc. (INGP.O: Quote, Profile, Research) had been completed.
Nasdaq and a consortium of investors announced plans in April to buy Instinet, majority owned by Reuters Group Plc (RTR.L: Quote, Profile, Research) (RTRSY.O: Quote, Profile, Research), for $1.88 billion.
Under the deal, Nasdaq will keep Instinet's Inet electronic trading network, while Instinet's institutional brokerage unit will go to private equity firm Silver Lake Partners.
Nasdaq aims to integrate the Inet network in a year.
"This integration will be completed within 12 months of closing, which is today," Nasdaq chief executive Bob Greifeld told Reuters. "So we have set ourselves up for our report card."
Greifeld said it was important that market participants had "one single deep and liquid electronic platform."
He acknowledged that integrating Inet with Nasdaq's current system would not be "an easy task" but said he had a "high degree of confidence" about the move, after integrating the Brut electronic communications network Nasdaq bought in 2004.
Greifeld also said the two entities had similar market models.
"Instinet is an electronic matching engine. Nasdaq is an electronic matching engine. ... The guts of the marketplace and the guts of the market structure are the same."
The deal received antitrust approval in November.
Instinet shareholders will receive about $5.0881 per share, on top of a dividend of 32 cents a share paid in August.
In a separate announcement, Reuters said its net cash proceeds from the deal would total $1.1 billion and would be returned to Reuters shareholders as part of a two-year share buyback program announced in July.
Completion of the deal comes two days after Nasdaq's archrival, the New York Stock Exchange, said seat holders overwhelmingly approved its deal to buy electronic trading company Archipelago Holdings Inc. (AX.P: Quote, Profile, Research) and turn itself into a public company. |
