NASDAQ AMEX MERGER

NASDAQ AMEX Merger

NASDAQ AMEX Merger

Just when it looked as if the proposed merger between the American Stock Exchange and the Nasdaq Stock Market had won the dissidents over, another critic has popped up. And this one is bringing the specter of antitrust into the merger.

The vote on the deal by American Stock Exchange seat holders, scheduled for next Thursday, appeared to be in the bag earlier this week. That was when Paul Liang, one of the exchange's largest seat holders and biggest critics of the deal, sold his 18 seats to a big specialist firm, Spear, Leeds & Kellogg. A vote of no by Mr. Liang could have jeopardized the two-thirds majority needed to approve the deal.

But yesterday a new critic of the combination emerged. Patrick Healy, president of the Issuer Network in Chevy Chase, Md., a consulting firm that advises public companies on where they should list their company's shares for trading, had supported the merger initially. But he withdrew his support after Nasdaq officials refused to address corporate discontent over the stock market's decision to increase listing fees by an average of 56 percent in January. He now worries that a combination of the two exchanges may lead, down the road, to unfairly high fees for companies that list their shares for trading on either the Nasdaq or the American Stock Exchange. He has asked the Securities and Exchange Commission, the Federal Trade Commission and the Department of Justice to review the merger with this anticompetitive issue in mind.

Michael Jones, senior vice president of the National Association of Securities Dealers, which oversees Nasdaq trading, said, “The N.A.S.D. has no plans to raise fees on American Stock Exchange companies.” But according to Mr. Healy, the camel's nose may be under the tent. “The time to address this issue is when Nasdaq needs regulatory approval,” Mr. Healy said. “Subsequent to the merger, you have a lot less leverage.” MORE usually accustomed to tracking the mergers and acquisitions of the worlds' corporations - and profiting from them - Wall Street found itself distracted by the prospect of a marriage altogether closer to home yesterday.

Nasdaq and the American Stock Exchange (Amex) confirmed they were in discussions about a merger that would better equip them to take on the might of the largest of the Wall Street markets, the New York Stock Exchange (NYSE). Details were not available, but the talks appeared to be at an advanced stage. Several obstacles remained, however. Both markets would have to persuade their own memberships to vote in favour of the union. While a merger may offer logic in terms of challenging to the overwhelmingly dominant NYSE, it would also be one between two starkly different trading systems, histories and cultures. The Amex dates back to the out-door curbstone brokers of the last century and only moved indoors in 1921. Like the NYSE, it still trades on a floor through "open-cry" auction. It remains best-known for energy stocks, although recently it has carved a niche in ...