The Next Online Brokerage - Built By You

[Rager]

Ameritrade, E-Trade up on unsubstantiated merger talk


NEW YORK (Dow Jones/AP) -- Shares of E-Trade Financial Corp. and Ameritrade Holding Corp. closed up Friday amid unsubstantiated rumors of a merger between the two online-brokerage firms.

Options on the stocks also were active, but one Wall Street analyst sought to shoot down the speculation.

E-Trade shares rose as much as 10.8 percent while Ameritrade advanced as much as 13.3 percent.

E-Trade shares closed up 93 cents, or 8.5 percent, at $11.93 on the New York Stock Exchange. Earlier Friday, the shares rose to as high as $12.19.

Ameritrade shares closed up 57 cents, or 5.3 percent, at $11.31 on the Nasdaq Stock Market. Earlier Friday, the shares rose to as high as $12.17.

The stocks ``rose on rumors of a merger of equals,'' said Sandler O'Neill & Partners analyst Richard Repetto, who doesn't own the stocks, in a research note. But Repetto added he didn't see any imminent deal.

Spokeswomen for Ameritrade and E-Trade declined to comment on the stock activity or the speculation of a merger between their companies.

One factor thought to be feeding the rumors was E-Trade's recent decision to cancel a planned trip to visit investors in Europe. E-Trade spokeswoman Pamela Erickson cited a ``schedule conflict'' for the cancellation and said the New York company is ``working on rescheduling.''

Repetto said he thought further consolidation would eventually occur among brokers, but in the short term ``we believe the rumors'' on Ameritrade and E-Trade ``are invalid.''

E-Trade and Ameritrade officials have said in the past that they are interested in more online-brokerage mergers, although the companies seemed more keen on being buyers rather than sellers.

On Friday, Ameritrade spokeswoman Donna Kush said mergers and acquisitions are a ``preferred growth strategy'' for the Omaha, Neb., company, which over the last few years has acquired online-brokerage assets such as Datek, a firm that was once a big rival to Ameritrade. ``We'll look at any opportunity,'' she said.

------
http://www.tallahassee.com/mld/tallahassee/business/technology/11583537.htm