Instinet To Go to Nasdaq
The Nasdaq Stock Market is aquiring Instinet Group Incorporated for $934.5 million in cash.
“They have the leading [electronic trading] technology on the planet,” Nasdaq CEO Bob Greifeld.
After the acquisition is completed, Nasdaq will be selling Instinet’s Institutional Broker division to Silver Lake Partners.
After these deals, NASDAQ will own INET ECN. Instinet is also selling its Lynch, Jones & Ryan (LJR) subsidiary to Bank of New York before the NASDAQ transaction takes place.
According to a ComputerWorld article,
Greifeld said synergies between the Nasdaq and Instinet technology infrastructures are expected to result in an annual savings of $100 million in the first three years after the deal is completed. He didn’t disclose further details, saying only that Nasdaq has “a clear plan that fits into our existing road map.”
Nasdaq spent $107 million to develop its own SuperMontage electronic order display and execution system, which went live in 2002. The homegrown technology will in all likelihood be scrapped as a result of the Instinet deal, said Jodi Burns, an analyst at Celent Communications LLC in Boston.
Shareholders of Instinet will receive $1.9 billion in cash.