Merger Talks Spur Trading in Quotron
Shares of Los Angeles-based Quotron Systems soared on record volume for a second day Thursday in the wake of the financial data firm’s acknowledgement that it is discussing a merger with an as-yet unnamed company, rumored to be banking giant Citicorp.
Quotron’s stock rose $1.75 on the over-the-counter market to $15.50 on volume of 8.7 million shares. The company said trading easily set a one-day record and represented nearly one-fourth of the 34.6 million shares outstanding.
On Wednesday, the company’s stock was up $1.875 on volume of more than 3 million shares.
According to Wall Street rumors, Quotron’s potential merger partner is New York-based Citicorp, the nation’s largest banking firm. Citicorp refused to comment on the matter. But there may be other suitors, analysts said, because the financial information field is currently hot.
Supplies Data, Computers
Quotron is one of the nation’s leading suppliers of computerized stock-market data to brokerage and market research firms. The company also makes the desk-top computers that receive the information.
“Citicorp is the most persistent rumor,” said Louis Brizzolara of the investment firm S. G. Warburg, Rowe & Pitman, Akroyd. “But there are lots of other candidates who would like to get into this business.”
Brizzolara estimated Quotron’s sale price at $21 to $22 a share, for a total transaction value of roughly $750 million. Quotron’s book value at Sept. 30 was $185 million.
Bruce B. Jackson, Quotron’s executive vice president, called the movement in the firm’s shares “unbelievable” but declined to provide further details on the merger talks.
Quotron’s outlook improved dramatically earlier this year when a formidable potential competitor, a stock-quote joint venture of Merrill Lynch and IBM, fell behind schedule and scaled back its marketing efforts. Partly as a result, Merrill Lynch extended its contract with Quotron for three years. The big brokerage house provides nearly one-quarter of Quotron’s revenue.
