E-Trade Group, the Menlo Park, Calif.-based discount brokerage firm, said Tuesday that it is buying TIR Holdings Ltd., an internationally focused brokerage.
The deal, valued at $122 million, has a number of strategic benefits for the retail-focused Internet broker and will give it access to a large institutional client base for the first time.
Headquartered in Dublin, TIR provides seamless trade execution, clearing, and settlement for 600 institutional clients across borders.
Judy Balint, the president and chief operating officer of E-Trade International, said the deal would help fulfill an early mandate by the firm to attract institutional clients. TIR's clients include a number of large pension funds and banks, Ms. Balint said. She declined to identify any of the institutions that use TIR.
The acquisition would also be in line with E-Trade's global strategy to provide on-line securities trading to retail investors around the world, Ms. Balint said.
"It jump-starts our cross-border capability, hooking our global electronic platform to their network," she said.
E-Trade has a presence in Canada, Australia, Sweden, and France and plans to offer on-line trading to retail investors in Japan and the United Kingdom this year, Ms. Balint said.
TIR has a presence in 35 countries, with dealing offices in Hong Kong, London, Melbourne, Manila, New York, and Tokyo.
E-Trade would also be able to offer its retail clients access to equity research that TIR provides for its institutional clients, Ms. Balint said.
The deal, expected to close by the end of the summer, would bring 140 employees into the E-Trade fold. Layoffs are not expected, Ms. Balint said.
Bill Burnham, an e-commerce analyst with Credit Suisse First Boston in San Francisco, said the move is a logical one for E-Trade.
E-Trade's customers will be able to trade around the globe without having to worry about foreign exchange issues, he said.
"It provides the glue that can link together different global franchises," he said. "It really shows that they're serious about global trading."
