Nyse chairman blasts Archipelago merger rebels
11 November 2005 | 7682 views | 0
Marshall Carter, chairman of The New York Stock Exchange, has blasted a group of rebel members seeking to delay the exchange's merger with electronic trading network Archipelago, saying the cost of defending their "baseless litigation" is approaching $7 million.
On Tuesday the group of dissidents - led by longtime seat-holder William Higgins - filed a motion for a preliminary injunction to temporarily block a scheduled merger vote on 6 December for 30 days. The group wants a new valuation of the deal and an independent board to review the merger.
But in a bulletin to seat holders, Carter says undertaking these steps would take months and "complying with the suit's unreasonable demands would waste millions".
Carter also defended the role that Goldman Sachs played in arranging the deal. The investment bank has come under heavy criticism for representing both the Nyse and Archipelago in the deal. At the time the merger agreement was announced Goldman Sachs owned a 15% stake in Archipelago and held 21 Nyse seats.
"Mr Higgins' portrayal of the role Goldman Sachs played in this transaction is false. We have disclosed in great detail the matchmaking role played by Goldman Sachs," says Carter in the memo, adding that seat values have tripled since the deal was announced.