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Strategies & Market Trends : The Final Frontier - Online Remote Trading -- Ignore unavailable to you. Want to Upgrade?

To: TFF who wrote (9822)	3/20/2002 5:57:31 AM
From: supertip	Respond to of 12617

Datek could fetch $1.4 billion Bids for the broker due Wednesday; winner won't be known for some time. March 19, 2002: 6:09 PM EST NEW YORK (CNN/Money) - Bids for Datek Online Holdings Corp. are due by Wednesday and the broker could fetch as much as $1.4 billion, sources familiar with the negotiations told CNN/Money. Several companies have made offers for Datek, including rivals ETrade Group Inc., TD Waterhouse and Ameritrade, sources said. But a winner will not be announced for several days or possibly a couple of weeks, a different source familiar with the auction said. Jersey City, N.J.-based Datek, the nation's fourth-largest online broker in terms of trading volume, competes against ETrade, Charles Schwab Corp. (SCH: Research, Estimates) and TD Waterhouse (TWE: Research, Estimates). Datek has more than 800,000 online accounts. Datek's private investors have shopped the firm as a way to cash out. An investor group led by Bain Capital paid $700 million in December 2000 to buy a majority stake in Datek Online. At the same time, privately-held Datek spun off its popular electronic trading network, Island ECN. In February, CNN/Money reported that Datek was looking for a buyer. Ameritrade is now seen as the most likely buyer, but the online broker lacks the cash or currency to make a high bid. However, Omaha, Neb.-based Ameritrade would make the best fit for Datek, analysts said. "Ameritrade doesn't own a market maker and they are very focused on trading," one analyst said, who declined to speak for the record. "Their overall philosophy is very closely aligned with Datek." An ETrade buy would present conflicts since the Menlo Park, Calif.-based online trader already has a market maker. However ETrade has more cash and its shares, which closed Tuesday at $10, are trading nearly 33 percent higher. Ameritrade (AMTD: Research, Estimates) finished at $6.75 Tuesday. "If Datek really wants liquidity then they would most likely favor ETrade," said analyst Justin Hughes, of Robertson Stephens. Datek, TD Waterhouse, and Ameritrade declined to comment. Bain Capital declined comment as well. ETrade could not be reached for comment.