Summary
On February 22, 2002, The Nasdaq Stock Market, Inc. (Nasdaq) filed an 8-K report detailing a significant transaction with the National Association of Securities Dealers, Inc. (NASD). Nasdaq entered into an agreement to repurchase approximately 33.77 million shares of its common stock from the NASD for an aggregate consideration of about $439 million. This repurchase is a crucial step in Nasdaq's ongoing restructuring efforts to achieve complete operational separation from the NASD. The transaction involves a combination of cash and newly issued Series A and Series B preferred stock, with the preferred stock structured to ensure the NASD maintains majority voting control until Nasdaq operates as a national securities exchange. The repurchase is being executed in two stages. The first stage, which closed on February 21, 2002, involved Nasdaq buying back roughly 13.46 million shares for approximately $175 million in cash. The second stage is expected to close by March 1, 2002, pending certain conditions. This move signifies a material step towards Nasdaq's independence and strategic repositioning within the financial markets.
Key Highlights
- 1Nasdaq is repurchasing approximately 33.77 million shares of its common stock from the NASD.
- 2The total consideration for the share repurchase is approximately $439 million.
- 3The payment will be made through a combination of cash and newly issued Series A and Series B preferred stock.
- 4The transaction is a key element of Nasdaq's restructuring to separate operations from the NASD.
- 5The NASD will retain majority voting control through preferred stock until Nasdaq operates as a national securities exchange.
- 6The repurchase is structured in two stages, with the first stage closing on February 21, 2002, and the second expected by March 1, 2002.