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To: H James Morris who wrote (84500)	11/18/1999 6:19:00 AM
From: oilbabe	Read Replies (1) \| Respond to of 164684

Since I mentioned NITE last week as being a breakout stock, I thought this might be of interest: Note that this is IMMEDIATELY ACCRETIVE & to be accounted for as a pooling of interests: Thursday November 18, 12:07 am Eastern Time Company Press Release SOURCE: Knight/Trimark Group, Inc. Knight/Trimark Group, Inc. Enters Options Market With Acquisition of Arbitrade Holdings LLC Knight Aims to Be World's Number One Options Market Maker Through Application of Proven, Wholesale Market Making Business Model Transaction Is Expected to Be Immediately Accretive to Earnings JERSEY CITY, N.J., Nov. 18 /PRNewswire/ -- Knight/Trimark Group, Inc. (Nasdaq: NITE - news), the largest wholesale market maker in U.S. equity securities, today announced its acquisition of Arbitrade Holdings LLC, a technologically advanced options market maker and asset manager, with operations in the U.S. and Europe. The transaction marks Knight's entrance into the options market and another step in the firm's efforts to diversify its revenue stream and expand its product offerings. Knight expects to invest up to $100 million over the next two years to fuel its long-term goal of becoming the top options market maker in the U.S. and abroad. ``The options industry is on the cusp of a transformation even more pronounced than the one experienced in the equities market earlier this decade,' said Kenneth D. Pasternak, President and Chief Executive Officer of Knight/Trimark Group. ``Once again, the variables at play are regulatory change, integration of technological advances and the rising importance of self-directed investors and resulting volume increases. We see a compelling need in the options market for the customer-driven focus, scale, technological prowess and reliance on human capital inherent in Knight's proven business model.' ``Knight plans to create new standards for speed, liquidity and best execution in the options market,' continued Pasternak. ``As these standards approach those we have set in the equities market, there will be a tremendous boom in the use of options by the self-directed retail investor. Just as Knight's very creation was a harbinger of the on-line investor revolution, our acquisition of Arbitrade will be a watershed event for the options industry.' ``As part of Knight, we will have the opportunity to lead the revolution of the U.S. options industry,' said Peter Hajas, CEO of Arbitrade. ``We also plan to leverage our combined expertise in electronic-based trading platforms to establish a sizable presence in Europe and Asia -- two regions that have already embraced electronic options trading.' The combined entity, which will offer on-line brokers, broker-dealers and institutional investors a ``one-stop shop' for processing options and stock transactions, will capitalize on economies of both scale and scope. Arbitrade's advanced technological expertise combined with Knight's existing platform will serve as a strategic asset across all product lines. Knight expects to save several million dollars each year by internalizing the equities market-making activities necessary to hedge Arbitrade's options positions. The combined entities also will apply the best practices developed by Knight and Arbitrade in their proprietary trading and risk arbitrage methodologies, respectively. These synergies, enhanced by Knight's established equities market making track record, will assist in the strong growth of options order flow. This transaction is expected to be accretive to earnings immediately upon closing of the transaction and is intended to be accounted for as a pooling of interests. In addition, Knight sees growth opportunities for Arbitrade's asset management business, which has $350 million in assets under management. This business leverages Arbitrade's significant trading expertise for institutional investors and high net worth individuals, including Arbitrade's owners. Currently, equity options in the United States are primarily listed and traded on open-outcry exchanges. However, there is a worldwide trend toward the use of electronic-based trading platforms in the options market. The majority of options exchanges in Europe and Asia are completely electronic.