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Tuesday, April 23, 2002|
E*Trade Strikes Deal with Japanese Version
E*Trade Group is upping its stake in E*Trade Japan to 36 percent from 29 percent. The Menlo Park, California-based broker is swapping 3.3 million of its shares for 31,250 of newly issued E*Trade Japan shares in a deal valued at $30.7 million (Yen 4 billion). The US broker is also paying the Japanese firm $6.9 million in cash to end technological obligations.
The deal is intended to bring E*Trade's institutional business in Japan, which is being rebranded as E*T Institutional from TIR Tokyo, closer to E*Trade Japan. The deal will also relieve E*Trade's of its obligation to provide technology support to E*Trade Japan by maintaining its Web site.
In a separate agreement, E*Trade Japan will purchase specified hardware from E*Trade Group for $1.5 million (Yen 195 million).
"Our collaboration benefits both companies as we focus on expanding revenue growth as well as offering new services to meet the needs of our clients," said Jarrett Lilien, chief brokerage officer, E*TRADE Group. "We are confident in E*TRADE Japan's leadership and proven performance demonstrated by its operating profitability and status as a leading online broker in Japan."
"This agreement strengthens our relationship with E*TRADE Japan while enabling us to reduce the cost of our technology infrastructure and streamline our operating model," added Lilien.
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