Ameritrade to buy Datek

Discussion in 'Retail Brokers' started by amunateg, Apr 7, 2002.

  1. amunateg


    Any idea how this is going to affect Datek account holders? Their limit orders are more expensive than Datek's, i'd hate to see them change their fees.
  2. I imagine that more mergers of this sort are sure to come.

    Robert Tharp
  3. amunateg


    yeah, there seems to be some cheap pickings amongst the discount brokers. i just don't want to see another RJT repeat. they had awesome fees and it all changed when TD Waterhouse bought them.
  4. agent99


    It's a done deal:

    Ameritrade and Datek Announce Landmark Merger; Combination Establishes a New
    (Business Wire 04/07 23:34:36)
    Leader in Online Equity Trades

    Business Editors

    OMAHA, Neb. & JERSEY CITY, N.J.--(BUSINESS WIRE)--April 8, 2002--

    Self-Directed Investors Benefit from
    Best-in-Class Technology, Value and Service

    Ameritrade Holding Corporation (Nasdaq:AMTD) and Datek Online
    Holdings Corp. announced today a merger agreement that creates the
    most efficient and one of the largest brokerages serving self-directed
    The merger unites the two firms with the fastest growing account
    base, lowest cost operations and highest operating margins in the
    online brokerage industry. At closing it will be the largest online
    brokerage measured by equity trades per day. This combination is
    expected to be immediately accretive and cash flow positive, realize
    significant financial and business synergies and establish a top-tier
    industry leader. Financial synergies should be approximately $100
    million after-tax when fully realized.
    Under the agreement, market liquidity will improve when
    shareholders of the new Ameritrade receive a single class of common
    stock, with the owners of Datek receiving 50 percent of the total
    outstanding capital stock. The value of the transaction is
    approximately $1.289 billion based on the closing price of Ameritrade
    stock on April 5, 2002 net of the acquisition of cash plus regulatory
    capital valued at $100 million. Principal owners of Datek include the
    private equity firms, Bain Capital, TA Associates, Silver Lake
    Partners, an affiliate of Groupe Arnault and Advent International.

    Together, the Company will:

    -- Have approximately:

    -- 164,000 trades per day;

    -- 2.7 million accounts;(a)

    -- $43 billion in client assets;(a)

    -- $2 billion in client margin balances;(a)

    -- Total annual revenues of $800 million;(b)

    -- Form:

    -- An experienced Board of Directors, with three
    representatives recommended by Ameritrade-- including Joe
    Ricketts as chairman, three representatives recommended by
    Datek's private equity investors and three independent

    "This is a wonderful day for our Company," said J. Joe Ricketts,
    chairman and founder of Ameritrade Holding Corporation. "This
    announcement marks an extraordinary advancement in Ameritrade's
    27-year history of building a premier financial institution in the
    online brokerage industry. I am particularly excited by the strength
    of the experience, shared vision and financial sophistication that we
    expect our new Board of Directors to bring in support of our
    management's focus on ensuring that the Company delivers on its full
    "Through this merger, Ameritrade reinforces our commitment to
    providing optimum customization and choice at a tremendous value for
    clients," said Joe Moglia, chief executive officer of Ameritrade
    Holding Corporation who will be the CEO of the combined company. "The
    realization of significant synergies from operations, advertising,
    technology and client service will enable us to accelerate our
    complementary growth and profitability strategies thereby creating
    additional value for shareholders."
    Ed Nicoll, chairman and chief executive officer of Datek Online
    Holdings Corp. added, "When we combine Datek's products, tools and
    technology with Ameritrade's highly-rated client service, we will
    establish an unbeatable proposition, especially for the active trader
    segment, by delivering a new standard of service and trading
    capabilities we know self-directed investors want."
    "The great interest Datek generated among potential partners gave
    the private investor group a unique opportunity to carefully evaluate
    a variety of online brokerage business models and growth strategies,"
    said Steve Pagliuca, a Managing Director of Bain Capital. "We
    unanimously concluded that investing in the market leader of a
    fast-growing and strategically important segment created the best
    long-term value. The new Ameritrade will set the standard of
    excellence in the marketplace for self-directed investors. We look
    forward to putting our collective skills and experience to work as
    members of the new Board of Directors."
    The transaction is expected to close within 90 days, subject to
    customary regulatory and shareholder approvals. On completion of the
    transaction, the Ricketts family will own 27.6 percent of Ameritrade
    common stock; Bain Capital will own approximately 10.7 percent of
    Ameritrade common stock; TA Associates will own approximately 9.0
    percent of Ameritrade common stock; Silver Lake Partners will own
    approximately 7.7 percent of Ameritrade common stock; Group Arnault
    will own approximately 4.8 percent; and Advent International will own
    approximately 3.1 percent.
    Ameritrade will update its current projections in the Investor
    Relations "Outlook" section of its corporate Web site located at after closing the transaction.

    About Ameritrade Holding Corporation

    Ameritrade Holding Corporation ( is a pioneer in the
    online brokerage industry with a 27-year history of providing clients
    a self-directed approach to investment services. The award-winning
    Company, through its Private Client and Institutional Client
    divisions, provides tiered levels of brokerage products and services
    tailored to meet the varying investing, trading and execution needs of
    self-directed individual investors, financial institutions and

    About Datek Online Holdings Corp.

    Established in 1998, privately held Datek Online Holdings Corp. is
    one of the most innovative financial services companies in the United
    States. The Company's primary businesses are Datek Online Financial
    Services LLC, a pioneer in the online brokerage industry; iClearing
    LLC, a securities clearing operation; and iCapital Markets LLC, a
    provider of execution services. (

    About Bain Capital

    Bain Capital is a global private equity firm with over $12 billion
    in assets under management. The firm has made investments in more than
    225 companies, across many industries. Headquartered in Boston, Bain
    Capital has offices in New York, San Francisco, London and Munich.

    About TA Associates

    TA Associates is one of the oldest buyout and private equity firms
    in the U.S. with offices in Boston, Menlo Park and Pittsburgh. TA
    manages over $5 billion in capital and has invested in 330 companies.

    About Silver Lake Partners

    Silver Lake Partners is a private equity investment firm focused
    on large-scale investments in technology and related growth companies.
    Silver Lake has offices in Menlo Park, California and New York. (

    About Groupe Arnault

    Groupe Arnault is the private investment vehicle for Bernard
    Arnault, chairman and president of LVMH.

    About Advent International

    Advent International has wholly owned and affiliated operations in
    30 countries across Western and Central Europe, the Americas, the Asia
    Pacific region and the Middle East. Advent International has
    particular expertise in chemicals, business services, healthcare,
    media, telecommunications and broadcasting, and information
    technology. The firm has 126 portfolio companies.

    (a) Source: Company reports. Data for the quarter ended December 31,
    (b) 4th calendar quarter annualized

    This document contains forward-looking statements regarding future
    events or the future performance of Ameritrade. Various factors could
    cause actual results to differ materially from those anticipated.
    Readers of this document are advised to review the documents filed by
    Ameritrade with the Securities and Exchange Commission, including
    Ameritrade's most recent Form 10-K and 10-Q for descriptions of risks
    and uncertainties that could cause actual results to differ materially
    from those described in the forward-looking statements.


    CONTACT: At Ameritrade:
    Director, Corp. Communications
    Donna Kush, 402/216-5486
    At Datek:
    Vice President, Public Relations
    Mike Dunn, 201/761-8767
    For Media:
    Magnet Communications
    Ann Pinkerton, 212/367-6865
    For Investors and Analysts:
    Director, Investor Relations
    Dave Pleiss, 402/440-8136

    SOURCE: Ameritrade

    Today's News On The Net - Business Wire's full file on the Internet
    with Hyperlinks to your home page.

  5. Pabst


    July 27,2004

    Greenwich CN.

    Interactive Brokers, a division of Timber Hill has entered into an agreement to buy the remaining assets of J.P. Morgan Securities. Morgan whose $20,000,000,000,000 in derivative losses crippled the Federal Reserve and FDIC earlier in the month will move it's remaining global derivative trading to IB. According to IB Chairman Thomas Peterffy"TWS will be the platform of choice for everything from options on Ruble-Yen to spreads on Brady Bonds". In Hong Kong an IB representative named DEF said that within the next few weeks native stops will be allowed on the TWS platform in response to many Morgan traders who have been locked out during frequent system outages.
  6. :D :D :D
  7. agent99


    I just listened to the AMTD/Datek conference call. When pressed by an analyst as to whether or not Datek's commissions would be raised to bring them into line with AMTD's (which are 50% higher for limit orders), AMTD management said that the financial projection assumptions included no pricing increases from the Datek side, only cost savings. They also said that they would keep their eyes on what was going on with pricing with the competitors, etc. (opening up a little wiggle room imo).

    The comments were mostly comforting, but it's not to say that they won't try to ultimately raise commissions later. If it does, I suspect that there will be a mass exodus for the doors, me among them. Hope Datek and AMTD management are keenly mindful of that. Pricing is DEFINITELY an issue.

  8. amunateg


    i have to second that. have had many good years with datek. they raise the price, i'm out of there!
  9. GRIME


    I think that DATEK's consumers could prepare for hiking prices for services....

    What do you thik so?
  10. The discount brokers are like the banks its like fighting fish out there. The Datek merger sets the stage for the smaller discount firms to get bought out. Soon everybody will be daytrading on line. Prediction- 18 months from now Daytrading will be the New American past time.

    Hey ameritrade who's next- Scottrrade or td.
    Or maybe tradestation?
    #10     Apr 9, 2002