The Nasdaq National Stock Market is currently negotiating a deal to take control of the American Stock Exchange, according to reports in The New York Times and The Wall Street Journal. In a deal that could be announced as soon as next week, the Amex would become a subsidiary of the National Association of Securities Dealers, the company which runs the Nasdaq. The Amex would still have its own trading board under the proposed agreement. The combination of the two exchanges would add the Amex’s roughly 770 companies to the NASD stable, creating a more formidable rival for the New York Stock Exchange, otherwise known as the Big Board. It is possible that some companies could elect to leave either the Amex or the Nasdaq in the event of a merger, but NYSE chairman Richard Grasso says there are few companies on either of the two exchanges that could meet the requirements for listing on the NYSE. The NASD would not confirm an imminent deal, but did say it is exploring several initiatives, including a combination with the Amex. The 27-year-old Nasdaq has come to dwarf the 87- year-old Amex with nearly 5,500 companies listed and 1997 revenue of $634.4m, compared to Amex’s $197.9m. Nasdaq’s focus on emerging companies and technology stocks throughout the 80’s and 90’s has led it to an average daily trading volume of nearly 650 million shares, while the Amex averages about 25 million.
