Knight (KCG) Board Mulls Proposals from GETCO, Virtu; Plans Another Meeting

November 30, 2012 3:45 PM EST Send to a Friend
Knight Capital (NYSE: KCG) is planning to hold a Board meeting on December 3rd to assess takeover offers recently received from Vitru and GETCO, Bloomberg reports today. It would be the second meeting this week.

The Board has already reviewed bids submitted on October 28th, but hasn't established a timeline on a decision yet. Knight is open to a merger, according to sources, and hasn't ruled out any other alternatives yet either.

This week, GETCO submitted a bid which values Knight at $3.50 per share and would retain its public listing. Virtu is proposing an all-cash bid of $3 per share, which may also be appealing.

Virtu contends that its offer is for all of Knight's shares and is more likely to be completed. The market-maker is able to get about $1 billion in financing from Credit Suisse and is in talks with three other banks for another $100 million, Bloomberg notes today.

GETCO is proposing a two-step reverse merger, in which Knight would reorganize as a holding company and GETCO would receive 242 million of newly issued stock with warrants for an additional 69 million shares. GETCO currently holds 57 million Knight shares and its tender would be for 154 million Knight shares excluding that stake. Following successful completion of the tender, GETCO's 57 million holding would be retired.

Shares of Knight are flat in late trading after being in negative territory for most of the session.


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