Instinet Group Inc, has rebuffed the unsolicited offer from Third Avenue Management LLC for its institutional business, preferring to stick with its deal with the Nasdaq Stock Market that will see the brokerage sold to Silver Lake Partners LP.

The firm announced that, “after careful consideration by its board of directors” it continues to believe that the pending merger with the Nasdaq is in the best interests of Instinet shareholders. In reaching this conclusion, the board reviewed Third Avenue’s letter, considered the terms of its April 22 merger agreement with the Nasdaq and had discussions with Nasdaq about the Third Avenue proposal.

It notes that under the Instinet-Nasdaq merger agreement, Nasdaq has agreed to acquire 100% of Instinet Group for approximately US$1.9 billion in cash. That deal contains specific, binding provisions limiting Instinet’s ability to consider alternative transactions, it notes, adding, “Third Avenue’s proposal, by its terms, is not a proposal to acquire 100% of Instinet Group, but only one of its businesses, and requires Nasdaq’s participation. For this reason, among others, the proposal is not reasonably likely to constitute a “superior proposal” as defined in the Nasdaq merger agreement, and therefore Instinet is not in a position to further pursue it.”

The Instinet board also notes that Third Avenue’s proposal is not a firm offer but rather is a conditional proposal subject, among other things, to “due diligence to its satisfaction”; that Nasdaq’s agreement with Silver Lake does not permit Nasdaq to sell that business to a different party; and, that Third Avenue didn’t participate in the six-month sale process that resulted in the Nasdaq deal, “although numerous other parties, both solicited and unsolicited, did”.