AMERITRADE TAKEOVER SPECULATION
The headline: Ameritrade (AMTD) Subject Of Takeover Speculation
The word: Ameritrade Chief Executive Joe Moglia joins the guys for this conversation.
First, what goes through you head on a day like today when the Dow drops substantially?
“The attention being paid to the retail sector,” replies Moglia. Over the span of the 3 or 4 weeks, individual investors have been very active in retail. Names like Wal-Mart (WMT), Home Depot (HD), JC Penney (JCP) and that was a little unusual.”
Why would that be?
Jeff Macke says “Wal-Mart and HD might have been long-term plays.”
This week hedge funds accumulated a position in your stock and have been agitating for you to consider a transaction. What’s going on?
“The point they made, was that they thought there would be value in doing a deal,” says Moglia. “I think we have a history of trying to do the right thing in terms of M&A activity and we will continue to do that.”
Do you view yourself as someone who would sell?
“No. I actually believe the Board in the end will make the right decision,” says Moglia. “We have done mergers where we were the acquirer. That has served us well. But at the end of the day we’ll do what’s best for shareholders.”
How about a deal with JP Morgan (JPM)?
Moglia replies “When you look at the job we’ve been able to do – you look at some of the larger financial service conglomerates, frankly it wouldn’t be a surprise to me, or anyone in the market, if they look at TD Ameritrade because we’ve done a great job with the retail investor.”
When people like billionaire hedge fund investor Steven A Cohen call you – what do they say?
“The types of interactions we’ve had with (Cohen’s firm) S.A.C Capital and (others) are similar to interactions we’ve had with the entire institutional investor base. We talk about what our organic strategy is, what our business plans are and what might happen with overall consolidation in the market,” Moglia says.
Guy Adami tells the panel he likes Ameritrade because he thinks Steve Cohen will keep the pressure on.
Moglia adds “From a TD Ameritrade perspective it’s not whether we can announce a deal and get a quick pop in our stock. It’s whether we can deliver long term value post the announcement. That takes 2 to 3 years… so we need to be thoughtful.
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Trader disclosure: On June 6 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders:Macke Owns (JWN), Najarian Owns (AMD),(.VIX),(AMTD), (AAPL), (NFLX), (NVDA); Bolling Owns (T), (ICE), (NMX), (MPEL); Bolling Is Short S&P Futures; Bolling Is Short Nasdaq Futures; Bolling Is Short (FXI) And Owns (FXI) Puts;