Pacific Exchange’s Sale to Archipelago Is OKd
The Pacific Exchange’s shareholders Tuesday approved a plan to sell the business for about $90 million in cash to Archipelago Holdings Inc., ending 143 years of independence for the stock-options market.
Archipelago, the third-largest electronic market for U.S. stocks, will complete the purchase of PCX Holdings Inc. by the end of the month, San Francisco-based PCX said in a statement.
Chicago-based Archipelago, which is combining with the New York Stock Exchange, took over the Pacific Exchange’s stock trading business in 2001 and is now moving into stock options, an industry valued at more than $1 trillion last year. The Pacific Exchange is the second-smallest of six U.S. stock-options markets.
PCX shareholders will receive $18.5 million plus the value of 1.65 million Archipelago shares at the time the purchase is completed. They will also get about $8 million for exceeding certain operating targets set when the deal was signed in January, spokesman Dale Carlson said.
About 76% of the shares were cast in favor of the transaction, the exchange said. Archipelago shares rose 74 cents to $38.99.
The Securities and Exchange Commission must still approve new rules for the Pacific Exchange before the deal can be completed.
Options give the holder the right to buy or sell assets at a set price by a certain date.
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