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Citigroup signs deal to purchase Mount Pleasant’s ATD
By Dan McCue
Staff Writer
It’s a done deal.
Early this morning, Citigroup Inc., the nation’s largest bank, announced it will buy Automated Trading Desk of Mount Pleasant for $680 million, including $102.6 million in cash and 11.17 million shares in Citigroup stock.
Under the deal, Steven Swanson will remain chief executive officer of the firm he founded in 1988 with fellow College of Charleston graduate Jonathan Butler and Rutgers University finance professor David Whitcomb.
The firm will also remain in its Mount Pleasant headquarters and operate as a unit of Citigroup's global equities business.
The banking giant said in a written statement it expects the transaction to close in the third quarter, pending regulatory approval. It said the impetus behind the deal was a desire to increase its ability to allow clients worldwide to trade stocks electronically.
In a written statement, James Forese, head of Global Equities at Citigroup, said the acquisition of ATD’s strong management team and its market-leading technology “will help us provide best execution to all of our clients by enhancing liquidity through the aggregation of greater flow.
“The combination of Citi’s Global Equities business and ATD will create a leading U.S. stock trading platform,” he said.
In a separate written statement, Swanson, who is traveling in New York today, said the deal offers ATD a unique opportunity to use its technology in both domestic and international markets.
“The combination of our businesses will position us as a leader amid the rapid evolution of global market structure,” Swanson said. “This combination will be an outstanding opportunity for our customer base.”
It 2006, ATD traded 6% of the daily volume of both NASDAQ and the New York Stock Exchange, trading on average of more than 200 million shares a day, said company spokeswoman Mary Waggoner.
Using computer algorithms instead of traders, the company specializes in the rapid buying and selling of securities. Its Web site said ATD is “obsessed with staying at the forefront of trading-technology development, and harnesses its unique R&D culture to stay ahead of the market and its competition.”
Citigroup intends to expand ATD's platform worldwide, as more customers demand the ability to trade quickly and at low cost. The New York-based bank operates in more than 100 countries.
The company currently employs 115 people, the vast majority of whom are computer programmers. Only a very small percentage of employees, perhaps as few as a dozen, are involved in active trading.
The transaction is the latest in a series of acquisitions for Citigroup since it was freed 15 months ago from a Federal Reserve order that restricted mergers until the bank improved its internal controls.
Since then it has also acquired Lava Trading, an options market making business, TD Waterhouse Capital Markets and OnTrade ECN.
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