Pacific Exchange Board OKs For-Profit Plan

The Pacific Exchange board approved a plan to turn the third-largest U.S. options market into a private, for-profit company in a year, a spokesman for the exchange said.

Under the Pacific Exchange’s plan to convert from a not-for-profit organization, its 552 seat-holders would have their seats replaced by stock in the new company. These seat-holders, mostly brokerages and traders, would keep their trading privileges on the exchange.

The Pacific’s equities unit became a private corporation in May.

The exchange, which has trading floors in San Francisco and Los Angeles, said it plans to consider an initial public offering in the next year or two.

The Pacific’s plan for the options market still needs approval from seat-holders, the Securities and Exchange Commission and the Internal Revenue Service.