Ameritrade To Buy Datek

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Ameritrade Holding Corp. is buying Datek Online Holdings Corp. for $1.29 billion in stock in a deal that creates the nation's largest online brokerage house in terms of equity trades, the companies said.

When the purchase is complete, Omaha-based Ameritrade will have 2.7 million accounts and 164,000 trades per day. Ameritrade says the company will have annual revenues of $800 million.

``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, who will have the same position at the new company.

The deal follows several smaller acquisitions in the online brokerage industry, which took off in the late 1990s amid soaring stock prices and the growing popularity of the Internet. But it fell on hard times when the Internet bubble burst, only to see a modest recovery in recent months.

Datek, based in Jersey City, N.J., is owned by a group of private equity firms that put the company up for sale earlier this year.

Founded 27 years ago by Joe Ricketts of Omaha, Ameritrade exploded in growth in 1997 when it began offering rates as low as $8 a trade.

The transaction is expected to close within 90 days, the companies said.
  • Christopher Weber

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