updated 6/22/2005 6:32:05 PM ET 2005-06-22T22:32:05

Rejecting a takeover offer from E-Trade Financial Corp., Ameritrade Holding Corp. on Wednesday said it will instead acquire rival online brokerage TD Waterhouse from Toronto-Dominion Bank.

The acquisition has been rumored for weeks. Online brokerages — which at the height of the stock market boom saw valuations soar above brick-and-mortar firms such as Merrill Lynch & Co. and Morgan Stanley Inc. — have recently been hurt by price cuts, lower commissions and a drop-off in equity investing.

The overall value of the deal was not disclosed.

Ameritrade Chief Executive Joe Moglia will become CEO of the combined entity.

E-Trade earlier this month reportedly sweetened its bid to acquire Ameritrade, offering a 49.5 percent stake in the combined company and about $2 billion in cash. In May, Ameritrade rejected an offer from E-Trade for a 47.5 percent stake in the combined company plus $1.5 billion.

Toronto-Dominion had also been approached by E-Trade about a possible merger, but the talks broke down over how the newly formed company would be run. Ameritrade’s Moglia has also resisted any plans to relinquish control of the company.

Omaha, Neb.-based Ameritrade has a history of successful transactions, having acquired or merged with five companies since 2001. That includes the acquisition of National Discount Brokers Corp. in 2001 and Bidwell & Co. last year.

Its biggest coup to date has been its 2002 merger with rival Datek Online Holding Corp. With that move, Ameritrade added more than 800,000 accounts and $11 billion in client assets.

© 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


Discussion comments


Most active discussions

  1. votes comments
  2. votes comments
  3. votes comments
  4. votes comments

Data: Latest rates in the US

Home equity rates View rates in your area
Home equity type Today +/- Chart
$30K HELOC FICO 3.79%
$30K home equity loan FICO 4.99%
$75K home equity loan FICO 4.69%
Credit card rates View more rates
Card type Today +/- Last Week
Low Interest Cards 13.83%
Cash Back Cards 17.80%
Rewards Cards 17.18%
Source: Bankrate.com