Archie's Corner

[excel]

Thanks Arch! Anyone see this? Interesting.


New York Broker Buys RJT.Com Parent

BY GRACE SHIM







WORLD-HERALD STAFF WRITER

RELATED LINKS

» RJT.com


The pool of online brokerages got a little smaller Wednesday when New York-based TD Waterhouse Group announced its acquisition of Omaha-based R.J. Thompson Holdings.


Chief Executive Randall J. Thompson

R.J. Thompson Holdings is the parent company of RJT.com, which allows day traders to directly place orders in the stock markets through "direct access" trading. RJT.com will serve as the active trader division for TD Waterhouse, with integration of the two companies expected by the first half of next year.

"It was one of the pieces that Waterhouse was missing," said RJT.com founder and Chief Executive Randall J. Thompson.

Steve McDonald, chief executive of TD Waterhouse, called the acquisition "an excellent opportunity for us to further expand our presence in the active trader arena."

TD Waterhouse, which is the second-largest U.S. brokerage with 3.1 million customers worldwide, would not disclose the acquisition price. Upon regulatory approval, the deal will close sometime in the fourth quarter of this year, which begins Oct. 1.

RJT.com President Ted Price said the cash deal had been in the works for a while, but he declined to elaborate.

Thompson said the ownership change will not affect service for its 13,440 day traders.

Thompson said the company and its 42 employees will remain in Omaha. And, for the time being, the company will keep the RJT.com name.

But, with the sale, there are two title changes. Thompson becomes the director of the active-trading division for TD Waterhouse. Gregory P. Gilgenast, RJT.com executive vice president and director, becomes the vice president of the technology group for TD Waterhouse.

"We couldn't be happier with the Waterhouse transaction," Thompson said. "We feel comfortable with the folks at TD Waterhouse."

RJT.com is a 19-month-old firm started by Thompson, a former executive with Omaha-based competitor Ameritrade Holding Corp.

RJT.com found a market with its low-priced stock market trades - a $5 fee for any type of trade.

That's $3 less than Ameritrade, a discount broker known for its $8 equity trades.

Ameritrade is the fourth-largest online brokerage in the United States. From 1991 to 1993, Thompson was the president of Accutrade, an Ameritrade subsidiary.

Brokerages have been hit hard by the volatile market and economic downturn, and analysts have long predicted that brokerages outside the top 10 would be acquired.

Thompson acknowledged in a March interview with The World-Herald that he was open to that possibility.

"If something comes along, and the fit is right and it provides value for our shareholders, we certainly will consider it," he said.

Richard Rzasa, chief information officer for TD Waterhouse, said the company was interested in RJT.com because it had superior technology and a good business model and its executives were knowledgeable.

Todd Halky, research associate for Putnam Lovell Securities in New York, said TD Waterhouse was a little late getting into the lucrative direct-access market compared with its competitors. But he said TD Waterhouse probably got RJT.com for a better price because it paid cash.

"This allows them to make sure they can offer a product to the entire spectrum of the online brokerage community," he said. "This just rounds out their product offering."

TD Waterhouse trades on the New York Stock Exchange. Its stock opened at $8.75 per share Wednesday and closed down a penny.


Excel - Greg