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Ameritrade-Datek Merger OK'd

Omaha, Neb.-based Ameritrade closed its $1.29 billion acquisition of Jersey City, N.J.-based Datek Online Holdings Corp., creating the largest online brokerage firm in terms of daily equity trades.

Stockholders of both companies voted to approve the deal. But whether that translates to an improved bottom line for the merged operation remains to be seen.

On the same day as the completion of the merger was announced, Ameritrade said it expects to report a net loss of 19 cents a share for its fiscal fourth quarter ending Sept. 27, including a pretax charge of 23 cents per share for a $65 million writedown on the sale of its financial software subsidiary TradeCast, which it bought last year.

However, the Datek deal had little impact on that quarter as its results reflect revenue from Datek only from Sept. 9.

At the time the merger was announced, Ameritrade said that the combined firm would have about 164,000 trades per day and over 2.76 million accounts. It is expected to manage approximately $43 billion in client assets and take in total revenues of $800 million.

The Ameritrade board also approved the repurchase of up to 40 million shares. The stock closed at $3.30 on Monday.