(January 31 – 10:00 ET) – The Charles Schwab Corp. and TD Waterhouse Group Inc. have formed a new market making joint venture in the U.K.

The two firms have also agreed to acquire Glasgow-based market maker Aitken Campbell from Abbey National plc for £60 million as the foundation for their operation. Schwab and TD Waterhouse will each own 50% of the proposed joint venture. The transactions are subject to various regulatory approvals, which are expected by the second quarter of 2001.

The joint venture will continue to operate under the Aitken Campbell name and will still be based in Glasgow, where the firm has approximately 40 employees and makes markets in approximately 250 UK securities. Lon Gorman, vice chairman of Schwab, and Bharat Masrani, vice chairman of TD Waterhouse, will serve as co-chairmen of the new joint venture.

TD Waterhouse is the largest execution-only broker in the UK based on trading volume. Schwab Europe is the U.K.’s leading nominee and online stockbroker and was the first to introduce online dealing in 1998.

“We’ve learned that the more involved we are in the trading process, the better we can serve our clients,” said Gorman. “Our goal is to apply Schwab’s market making ‘best practices’, client focus, technological expertise and liquidity to maximize best execution for our clients around the world. The U.K. is the first stop in Europe.”

“This joint venture provides TD Waterhouse with the opportunity to expand in a new strategic direction that will further our goal of diversifying our revenue streams,” said Steve McDonald, CEO of TD Waterhouse. Masrani added, “This joint venture illustrates our commitment to providing our clients with the highest quality service, and allows us to vertically integrate our businesses in the U.K.”

In November 1999, Schwab and TD Waterhouse, along with other brokerage and venture capital firms, formed Epoch Partners, an online investment bank.
-IE Staff