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The Spokesman-Review Newspaper
Spokane, Washington  Est. May 19, 1883

Nasdaq to pay $61 million for Boston Stock Exchange

Associated Press The Spokesman-Review

BOSTON – The Nasdaq Stock Market Inc. said Tuesday it would buy the Boston Stock Exchange for about $61 million, putting the Boston exchange under outside ownership after 173 years of independence.

Nasdaq’s acquisition of the Boston exchange, the third oldest in the United States, comes amid a global wave of consolidation among stock exchanges.

Included in Tuesday’s deal are the Boston exchange’s holding company, BSE Group, as well as the Boston Equities Exchange, the Boston Stock Exchange Clearing Corp. and BSE’s regulatory authority over the Boston Options Exchange.

BSE’s minority interest in the Boston Options Exchange is not included in the transaction because the company is talking to the Montreal Exchange about selling the stake and related companies.

Nasdaq president and chief executive Bob Greifeld said in a statement the acquisition should give the New York-based exchange “added liquidity, new trading choices and an enhanced competitive market environment.”

The deal, expected to close early next year, is subject to approval by the Securities and Exchange Commission and BSE members.

Michael J. Curran, chairman and chief executive of the Boston Stock Exchange, acknowledged recent dealmaking among stock exchanges globally created pressure for his exchange to follow suit.

“Though it is a sad moment for the BSE and its 173-year heritage of innovation and service to the U.S. markets, we are not immune to the global consolidation that is occurring in this industry,” Curran said in a statement.

Tuesday’s deal comes seven months after the Boston exchange announced plans to convert from a membership organization owned by its seat holders to a for-profit structure. Analysts said the initiative was expected to lead to an eventual public stock offering by a growing regional player seeking to compete with bigger exchanges like Nasdaq.

But on Sept. 5, the Boston Stock Exchange closed operations of its two-year-old electronic stock exchange called the Boston Equities Exchange, or BeX, acknowledging it had struggled to gain market share.