Schonfeld Group and Lightspeed Holdings to Merge Retail Trading Operations

Discussion in 'Prop Firms' started by QuoteBoy, Oct 10, 2006.


    Schonfeld Group and Lightspeed Holdings to Merge Retail Trading Operations

    -- Combined Company to be Clear Leader/Active Consolidator

    of Professional Trader Business; Deal Roughly Doubles Individual Company Volumes .

    -- Merged Business to Offer Advanced Technology/Execution Platform

    for Trading Partnerships and Hedge Fund Community --

    NEW YORK, October 4, 2006 . Leading trading and technology firms, Schonfeld Group Holdings, LLC and Lightspeed Holdings, LLC, today announced the two companies have signed a letter of intent to merge their retail trading operations into what will represent one of the largest companies dedicated to the professional trader. Under the agreement, Schonfeld Group.s retail trading entity, Schonfeld & Company LLC, will combine with Lightspeed Professional Trading LLC, a subsidiary of Lightspeed Holdings.

    While financial terms of the transaction were not disclosed, Schonfeld Group will become a major shareholder in Lightspeed Holdings. Lightspeed Holdings acquired the active trading business of E*TRADE Professional Trading, LLC and ETP Technologies, LLC from E*TRADE FINANCIAL Corporation in July of this year. The combined company will operate under the Lightspeed brand and be headed by Lightspeed Holdings CEO Stephen Ehrlich. Schonfeld & Company.s CEO Andrew Actman will join the management team at Lightspeed.

    "This combination creates a giant in the field of active trading," said Mr. Ehrlich. .We believe we are seeing a convergence between the needs of the highly-active retail customer and the small to mid-size hedge fund manager, and the combined company.s direct market access trading and brokerage services solutions will fit the needs of both of these groups."

    Following the merger, Lightspeed Professional Trading will be the leading player in the active trading industry with:

    n Approximately 100,000 trades a day.

    n Approximately $250 million in customer assets.

    n Approximately 2% of Nasdaq share volume.

    Steven Schonfeld, CEO and Founder of Schonfeld Group, said: .By partnering with Lightspeed, we are well-placed to continue the consolidation of the active trading space . an industry about whose growth prospects we remain very excited.. Schonfeld continued, .This transaction enables our company to focus more closely on our proprietary trading and asset management businesses..

    Andrew Fishman, Schonfeld Group President, added, .The trading business rewards scale. Our ability to send significantly more trading volume through a superior trading platform positions our retail customers and Lightspeed Professional Trading customers for great success. We are also pleased to further our goal of diversifying our retail trading customer base beyond the branch office model. Following several consolidating asset acquisitions, including those of Trinix Securities and ETG, we are now even more well-balanced in our approach to this market..

    The transaction is subject to customary conditions to closing, including regulatory and other approvals.

    About Schonfeld Group

    With roots that date back to 1988 and one of the active trading industry pioneers, New York-based Schonfeld Group Holdings, LLC today includes businesses with leadership positions in proprietary trading, institutional brokerage services and retail trading. The company.s fast-growing asset management business includes a fund-of-funds and a multi-strategy hedge fund. Schonfeld traders routinely trade 2-4% of all the daily volume on the NYSE and Nasdaq stock markets.

    About Lightspeed Holdings

    Headquartered in New York City, Lightspeed Holdings operates through two wholly-owned subsidiaries:

    Lightspeed Technologies, LLC serves as the Company's technology development subsidiary. Lightspeed develops and operates the Lightspeed Direct Market Access trading software application, the Lightsource real-time risk management application and the Middle Office Technology suite. Utilizing a number of proprietary technologies, Lightspeed offers real-time market data platforms and direct-access trading systems to broker-dealers, institutional entities and professional traders.

    Lightspeed Professional Trading, LLC operates as a fully disclosed introducing broker-dealer and NASD and NFA member. Lightspeed offers securities and direct access brokerage, trading and advanced order routing services to its customers utilizing Lightspeed's software products.