E*TRADE Financial has agreed to acquire Aperture New Holdings, the ultimate parent company of OptionsHouse, for $725m in cash to boost its derivatives capabilities.
Headquartered in Chicago, OptionsHouse currently has 154,000 customer accounts with $3.6bn in customer assets, including $1.4bn in cash.
E*TRADE, which operates a discount broker-dealer and a bank, said it intends to finance the deal by issuing up to $400m of preferred stock.
Commenting on the deal, E*TRADE Financial CEO Paul Idzik said: “We believe options are an important component of an investor's arsenal, and this deal will intensify our derivatives firepower. Further, we could not be more excited to show OptionsHouse customers all we have to offer, including deep research and education, long-term investing tools, and a best-in-class mobile experience.”
E*TRADE expects the transaction to be relatively neutral to earnings in 2017 and accretive in 2018.
The transaction is expected to close in the fourth quarter of 2016, subject to customary closing conditions and regulatory approvals.