* Joyce says strategic review underway looking for
* Says new directors very active
* Supports idea of Direct Edge sale
By John McCrank
WASHINGTON, Sept 21 Knight Capital Group
is not likely to shed any of its major business units after the
Aug. 1 trading glitch that cost the market maker $440 million,
forcing it to take on additional investors to avoid bankruptcy,
Chief Executive Thomas Joyce said on Friday.
Volume levels at Knight, one of the top executors of U.S.
stock trades, have returned to normal and now management and the
firm's reconfigured board are conducting a strategic review of
Knight's business units, Joyce said last week.
Speaking with reporters on Friday, Joyce said the thrust of
the review is to look for efficiencies.
"An error was made on August 1, but we didn't really alter
our view that we kind of like our footprint. The businesses that
we are in, I think are doing well, and at this point we have
every intention of building on that success," he said on the
sidelines of a conference held by the Security Traders
Aside from being a major market maker, matching equity
orders from buyers and sellers and providing liquidity by
stepping into the market themselves, Knight also runs bond and
foreign exchange trading platforms and owns a reverse mortgage
A group of investors, including Blackstone Group,
Getco and financial services companies TD Ameritrade,
Stifel Nicolas, Jefferies Group Inc and Stephens
Inc rescued the embattled market maker in a $400 million deal
that kept it in business.
As part of the deal, TD Ameritrade, Blackstone, and Getco
investor General Atlantic were given seats on Knight's board.
Joyce said the reconfigured board has had just one meeting
so far, but that the new directors were very active.
"They have been very communicative and they understand the
industry, so they have been very helpful in terms of industry
issues," he said. "The other three new investors have been
Knight also holds a stake of about 20 percent in Direct
Edge, the No. 4 U.S. cash equities exchange. Reports have said
in recent months that Direct Edge is looking for potential
merger partners, and Joyce, who once sat on Direct Edge's board,
said he supports the idea.
"There is a lot of logic if they find a bigger, global
partner. It gives somebody internationally a chance to have a
pretty big presence in the U.S., so I think it is a very
attractive asset," he said.