Both sides lobby NYSE seat owners
NEW YORK — John Mack, a leader of the group opposing the New York Stock Exchange’s planned merger with Archipelago Holdings Inc., said he spoke Tuesday with NYSE Chief Executive John Thain and won a promise from the Big Board leader to explain the deal to Wall Street firms.
The conversation came as representatives of both sides lobbied the exchange’s 1,366 seat holders who will ultimately decide whether to proceed with the merger, the Associated Press learned.
Mack, the former CEO of Credit Suisse First Boston and longtime Morgan Stanley executive, said Thain has agreed to meet with an undisclosed number of Wall Street firms to discuss the merger. Representatives of the firms had attended a Monday meeting hosted by former NYSE board member Kenneth Langone to air their concerns about the merger and discuss a possible counteroffer for the exchange.
“We are encouraged that these efforts have sparked an open discussion about maximizing value for the exchange,” Mack said in his statement. “We hope this process will allow firms to gather sufficient information to make a determination about the value of the proposed transaction.”
The NYSE had no immediate comment on Mack’s statement. A spokesman for Mack said there would be no additional comment.
Meanwhile, representatives of the group headed by Langone and Mack spent Tuesday seeking support for their effort against the merger, according to two seat holders who received calls from both sides. A source close to Langone’s group said a number of other interested parties called to lend their support as well.
In addition, a number of seat holders and Wall Street firms have also been contacted by the exchange in an effort to talk up the merger’s benefits, including at least one call to a seat holder by Thain, sources said.
NYSE spokesman Ray Pellecchia said Thain regularly talks with seat owners about the dealings of the exchange. A spokesman for Langone had no comment about any lobbying efforts
What seemed last week to be a slam dunk by Thain has been marred by Langone’s efforts to scuttle the merger, though the group has toned down its rhetoric and now says it wants to merely investigate the deal further. Langone nonetheless has managed to enlist both Wall Street firms and unhappy seat holders to explore either a counteroffer for the exchange or form a bloc of seats that could ultimate vote the merger down.
But both sides may have alienated a key constituency in their battle for the future of the NYSE — the exchange’s floor traders. Some traders speaking privately said they feared for their jobs under both the merger plan and Langone’s effort, which they said would spell the end of floor trading at the exchange and the NYSE’s ability to get the best price for investors.