Charles Schwab Corporation (SCHW) said Monday it agreed to buy smaller retail brokerage OptionsXpress Holdings Inc. (OXPS) in a deal valued at about $1 billion.
The all-stock transaction values OptionsXpress at $17.91 per share, a 17% premium over its $15.33 closing price on Friday.
Under the terms of the deal, which is expected to close during the third quarter, subject to OptionsXpress stockholder approval and regulatory approvals, shareholders of Chicago-based OptionsXpress would receive 1.02 shares of Schwab stock for each share of OXPS stock.
Schwab and OptionsXpress will initially retain their separate brand identities, the companies said, “while benefiting from significant synergies and capabilities across their complementary business lines.”
“The combination of OptionsXpress and Schwab will offer active investors an unparalleled level of service and platform capabilities. OptionsXpress’ industry-leading and award-winning client tools will be well received by our existing active investor clients who are increasingly using options and other trading strategies as a key part of their total approach to investing,” said Walt Bettinger, Schwab President and Chief Executive Officer.
Shares of OptionsXpress, a co. which, as of Feb. 28, 2011 had 385,200 client accounts, $8.1 billion in client assets and a 12 month average of 44,800 daily average revenue trades, surged 15% in early trading, while shares of San Francisco-based Schwab, the nation’s largest independent brokerage in terms of client assets, edged fractionally higher.