NEW YORK - US online brokerage firm E-Trade Financial said Thursday it was offering to buy rival Ameritrade, hours after Ameritrade said it was not for sale.
E-Trade said the offer would give shareholders of Ameritrade 47.5 percent of the combined company plus 1.5 billion dollars in cash. It also said savings or "synergies" from the deal would amount to 650 million dollars.
E-Trade made the offer public after days of speculation about the deal, and hours after Ameritrade said it was not interested.
"The proposed deal represents immediate value creation for shareholders of both Ameritrade and E-Trade Financial," said E-Trade chief executive Mitchell Caplan.
"Our proposal would generate tremendous benefit from combined revenue and expense synergies. E-Trade's business model provides Ameritrade a differentiated opportunity to take advantage of significant revenue creation by monetizing key aspects of the brokerage business through our cash management structure and by integrating customer order flow with our institutional business."
The statement said the offer would give Ameritrade "joint participation in senior management roles and representation on the board of the combined entity."
Hours earlier, Ameritrade sought to quash speculation about a deal.
"The board believes there will likely be further consolidation in the industry, but confirmed Ameritrade is not for sale," Ameritrade founder and chairman Joe Ricketts said in a statement.
"We are confident in our management team and its strategy," he said.
The New York Times said Monday that Ameritrade had become the target of a takeover offer worth more than 5.5 billion dollars.
Separately, The Wall Street Journal reported that top executives at the two companies had held exploratory talks over the past year.
Analysts have been anticipating mergers in the US discount brokerage sector, with trading volumes still weak since the collapse of the "dot com" boom, and intense competition keeping commissions low.
While Ameritrade denied being for sale, its chief executive Joe Moglia did not rule out seeking "strategic opportunities" in the future if they enhance shareholder value and benefit its clients.
05/12/2005 18:21 GMT