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Non-Tech : E*Trade (NYSE:ET) -- Ignore unavailable to you. Want to Upgrade?

To: KM who wrote (10003)	12/20/1999 8:31:00 PM
From: KM	Read Replies (1) \| Respond to of 13953

ETrade, Telebanc Say OTS Closer to Approving Merger Menlo Park, California, Dec. 20 (Bloomberg) -- ETrade Group Inc. said its application to merge with online bank Telebanc Financial Corp. has been deemed complete by the U.S. Office of Thrift Supervision, moving the transaction closer to completion. The two companies are ''optimistic of an expedited regulatory approval process and both parties continue to work aggressively to close the transaction as quickly as possible,'' ETrade, the No. 2 Internet broker, and Telebanc said in a release. The companies have said the $1 billion merger, announced June 1, would close by year-end. The merger is unlikely to close by then, though odds are good for early 2000, said Greg Smith, analyst at Hambrecht & Quist Group. He reiterated a $40 price target for ETrade, saying merger uncertainty has been ''weighing on'' shares. Internet brokers' shares have declined on concerns about increased competition, from other Internet brokers in the form of more than $1 billion annually in ad spending, and from full- service brokerages. ETrade wants to add banking services as a way to balance its reliance on brokerage commissions. ETrade has said the OTS had questions about how much control Softbank Corp., a Japanese firm that distributes software and owns stakes in Internet companies, would have over the post- merger company. Softbank owns 26.1 percent of ETrade. ''At this point it looks a lot better than it did before'' for completing the merger by Dec. 31, said Scott Appleby, analyst with BancBoston Robertson Stephens. ''Typically once an application is deemed complete that fairly often means it will get approved,'' possibly this week. Menlo Park, California-based ETrade will pay 1.05 shares for each of Telebanc's 33.9 million shares outstanding. E*Trade fell 1 1/8 to 28 15/16 at the close of regular Nasdaq Stock Market trading, giving the transaction an indicated value of $30.38 a share, or $1.03 billion. That's down from $1.8 billion June 1. Arlington, Virginia-based Telebanc rose 1 1/16 to 28 5/16, meaning that the stock sells for 7 percent less than the merger's indicated per-share value. On Friday, that gap was 14 percent. Dec/20/1999 16:42 For more stories from Bloomberg News, click here.