Build­ing a big­ger bro­ker­age

Daily Freeman (Kingston, NY) - - BUSINESS -

TD Amer­i­trade is buy­ing Scot­trade in a $4 bil­lion deal that would ex­pand the on­line bro­ker­age firm’s re­tail and branch busi­ness.

In the two-stage deal, TD Bank Group will buy Scot­trade Bank first from Scot­trade Fi­nan­cial Ser­vices for $1.3 bil­lion in cash. Then, TD Amer­i­trade will buy Scot­trade Fi­nan­cial Ser­vices for $2.7 bil­lion in cash and stock. Part of that pur­chase will be fi­nanced by sell­ing 11 mil­lion shares to TD Bank, which will con­tinue to con­trol 41 per­cent of TD Amer­i­trade’s stock.

TD Amer­i­trade said that the trans­ac­tion will more than quadru­ple the size of its net­work of about 100 branch of­fices. TD Amer­i­trade’s shares fell Mon­day fol­low­ing the an­nounce­ment, along with other on­line bro­ker­age firms.

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