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LaBranche buys Robb Peck
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October 11, 2000: 12:53 p.m. ET
Purchase of NYSE specialist firm gives LaBranche 27% of Big Board volume
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NEW YORK (CNNfn) - LaBranche & Co. Inc. agreed to acquire rival Robb Peck McCooey Financial Services Inc. for an undisclosed amount, increasing the specialist firm's lead on the Big Board.
New York-based LaBranche will swap 9.7 million shares and an undisclosed amount of non-convertible preferred stock. Based on LaBranche's closing share price Tuesday of $29.38, published reports pegged the deal at about $286 million. However, LaBranche CFO Harvey Traison said the deal could come in significantly higher due to the preferred stock.
LaBranche plans to close the deal by the end of this year and expects it to add to earnings beginning in first quarter of 2001. The specialist firm declined to disclose any further information on the purchase.
 Robb Peck, also of New York, owns RPM Specialist Corp., which is the sixth-largest specialist firm on the New York Stock Exchange in terms of listing and the seventh largest in trading volume.
Formed in 1924, New York-based LaBranche is the leading specialist firm on the New York Stock exchange, with 22 percent of share volume. Specialists connect buyers and sellers and make money on the spread between a stock's asking price and offer price.
The purchase of Robb Peck will boost's LaBranche's lead on the Big Board to 27 percent, Traison told CNNfn.com. The acquisition is LaBranche's third in a year. In March, it bought Webco Securities Inc., another NYSE specialist, for about $47 million. This followed the December purchase of Henderson Brothers Inc., the eighth-largest NYSE specialist, for $230 million cash.
The shares-trading industry has produced some high-profile acquisitions of late. On Tuesday, Deutsche Bank AG offered to buy National Discount Brokers Group Inc. (NDB: Research, Estimates) for nearly $1 billion, or $49 a share cash.
In September, Goldman Sachs bought Spear Leeds & Kellogg LP, a leading securities clearing firm, for $6.65 billion in cash and stock. In June, Merrill Lynch paid $900 million for Herzog Heine Geduld, the third-largest U.S. firm linking buyers and sellers on Nasdaq.
LaBranche is seeking to increase its position on the NYSE, Traison said, because of consolidation in the specialist industry. But the acquisition differs from Goldman's purchase of Spear and Merrill's deal for Herzog.
"These are two specialist firms joining forces," Traison said.
LaBranche does not envision selling to any large Wall Street firm, like Goldman or Merrill, in the future, Traison said.
"We're constantly aware of who the others firms are on the floor at all times," Traison said. "We're committed to being a leader in this field."
On Wednesday, LaBranche shares fell $1.19 to $28.19 in early afternoon trading. 
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