Datek Online Holdings
said a group of investment firms, led by
, has agreed to invest $700 million to acquire a majority interest in both Datek and
The Island ECN
According to terms of the transaction, Datek will acquire all voting shares of stock held by a group of original shareholders, including former CEO Jeffrey Citron. The investment group, together with current management led by CEO Ed Nicoll, will own 100% of the voting control of Datek. Island, which runs an alternative trading system, will be spun off as a separate company.
Datek said the investment is the largest private equity investment in an online financial services firm and provides capital needed to "develop new products and expand into new areas."