Instant Instinet

15 April 2005

Even if it geared itself up to the gills, it will be a big stretch for Nasdaq to buy all of Instinet for cash. As a result, Reuters may not get the clean exit many of its shareholders have expected from the sale.

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The Nasdaq stock market is in exclusive talks to buy Instinet, the electronic marketplace and broker dealer owned by Reuters, according to reports.

Archipelago was at one point the leading bidder for Instinet, but people familiar with the matter said Reuters was negotiating exclusively with another buyer.

Reuters, which owns 63% of Instinet worth some $1.2bn at Thursday's closing prices, has been looking to sell the business for several months. Nasdaq's market capitalisation is $840m.

Reuters reports first quarter revenues on April 20. The group would prefer to sell the whole of the Instinet business rather than retain a small holding, the FT said.

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