Atticus targets Archipelago

Wed Jun 1, 2005



Plans to turn the 213-year-old New York Stock Exchange into a publicly traded company, via a merger with the ECN Archipelago, may be causing member infighting and splashy headlines full of second-rate intrigue and disingenuous politics. But don't be distracted. The real story is taking place beneath the surface, as the deal is also causing ripples in the markets for hedge fund shareholders in ECNs, including many who have made big profits already. Others may be plotting bigger gains yet - and ripples of their own.

Just follow the money. Archipelago Holdings saw its stock shoot from a low of $11.50 to a high of $35.50 in early May. That was surely a welcome occurrence for hedge funds like Timothy Barakett's Atticus Capital, a $5 billion fund group, which holds some 2.4 million shares in the ECN. At the recent $35.50 price, the value of the Atticus stake in Archipelago weighs...

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