Business television network CNBC said on Tuesday that it plans to acquire a 12.4% stake in electronic communications network (ECN) Achipelago. Financial terms of the agreement were not disclosed. Archipelago runs an electronic trading system that matches buy and sell orders for stocks traded on the Nasdaq exchange. It is one of about a dozen such trading networks currently in operation in the US and has plans to begin trading NYSE-listed shares later this year.
Archipelago began as a joint venture with software developer Townsend Analytics Inc and became one of the original four ECNs approved for business by the Securities and Exchange Commission in 1997. In August, Archipelago filed with the SEC to become a full-fledged national securities exchange and it is reportedly considering an initial public offering next year.
CNBC, a subsidiary of General Electric Co, joins a group of existing Archipelago investors that includes E*Trade Group Inc, Goldman Sachs Group Inc, JP Morgan & Co, American Century Cos, Merrill Lynch & Co and Instinet, a subsidiary of Reuters Group Plc. Merrill, which bought a 14.3% stake only last week, is believed to have paid $30m.
