FOX Business Network (FBN) Senior Correspondent Charlie Gasparino reports that “Knight Securities is moving toward accepting the Nasdaq payout plan on the botched Facebook IPO,” and that the company “plans to announce its intentions in a comment letter as early as tomorrow.”
On Whether Knight Capital Will Accept Nasdaq’s Compensation Plan:
“Knight Securities is moving toward accepting the Nasdaq payout plan on the botched Facebook IPO. Knight Securities plans to announce its intentions in a comment letter as early as tomorrow. Nasdaq sweetened the accommodation deal after meeting with Tom Joyce and the senior officials at Knight Securities.”
Knight Capital Group Inc. (NYSE:KCG) had previously criticized Nasdaq’s $40 million dollar offer in response to the failed Facebook Inc (NASDAQ:FB) IPO. This was their stance up until today, apparently, as it seems that Nasdaq may finally be making an offer Knight can consider as reasonable. Knight had previously threatened legal suit against Nasdaq, citing that they were moving to slowly to correct the massive mistakes that led to the failed IPO. It has also been noted that nearly $100 million in losses were reported in connection with the event.
Whether or not Knight Securities will actually accept the offer made by Nasdaq, still remains to be seen, although sources indicate that Tom Joyce and other officials have been considering the new proposal. This might lead to a final burying of the hatchet between the two entities.
Nasdaq officials will be glad to have this case out of the way. The mishandling of Facebook’s IPO was a major public error on their part, and they are paying high consequences, with criticism from all around the globe. Facebook Inc (NASDAQ:FB)’s stock was initially offered at $38 and some change per share, and has fallen steadily since the IPO. Part of this may be to the poor performance in the advertising sector, due to more mobile users, but many believe that the failure of their debut on the market has also played a major role in this loss.