Datek sale imminent
Bank of America bids for online broker, sale expected in days.
March 7, 2002: 4:36 p.m. ET
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NEW YORK (CNN/Money) - The expected sale of Datek Online Holdings Corp. is accelerating and a deal could come in the next few days or early next week, people close to the situation told CNN/Money Thursday.
E*Trade Group Inc. and Ameritrade have made bids but the strongest offer now comes from Bank of America, a person close to the deal said. TD Waterhouse Group Inc. could also be in play, another person said.
A buy of Datek would represent a return to the online trading business for Bank of America (BAC: up $0.28 to $66.98, Research, Estimates) which once owned Charles Schwab.
"Bank of America is a major bank with retail accounts and they were in the discount business once," said one prominent discount broker. "Bank of America would be a natural."
However, others said the most likely buyer for Datek would be a rival online broker.
Datek, the nation's fifth largest online broker, competes against Schwab (SCH: unchanged at $15.30, Research, Estimates) and TD Waterhouse (TWE: Research, Estimates).
According a source familiar with the bidding, offers for Jersey City, N.J.-based Datek have ranged as high as $1.6 billion or more, although the $1.6 billion price has been discounted as too high by some. A more reasonable estimate for Datek would range from $950 million to $1.1 billion, which would carry a 15 percent to 20 percent premium, analyst Rich Repetto of Putnam Lovell said.
The sale of Datek is being driven by its investors which include Bain Capital, TA Associates, and Silver Lake Partners, sources said. The investor group made a $700 million investment in Datek in December 2000 and now owns 55 percent of the online brokerage.
Datek, Bank of America and Ameritrade (AMTD: up $0.20 to $6.42, Research, Estimates) all declined to comment. Bain Capital, Silver Lake and TA Associates also declined comment. E*Trade (ET: up $0.10 to $9.70, Research, Estimates) could not be reached for comment. 
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