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Spear, Leeds & Kellogg, the largest specialist firm on the New York Stock Exchange, has become even larger with the acquisition of Foster, Marks, Natoli & Safir, a medium-sized specialist firm. The acquisition pushes Spear Leeds' share of Big Board listings well over 10%, prompting some traders to cry foul.
Intriguingly, the exchange itself facilitated the transaction, by recently changing its market concentration rules that effectively limited specialists to no more than 10% of listings. The toughest standard was lifted last October to 15% of listings, paving the way for Spear Leeds' acquisition plans. Spear Leeds will now run about 11% of the Big Board's 2,343 listings.
Foster Marks was a private partnership headed by Benjamin (Buddy) Marks. The firm runs the book on about 35 listings on the Big Board, including such well known names as Templeton Emerging Markets Fund, Paxar Corp., and USAir Group Inc. Marks, 57, and his partner Bart Natoli, 53, agreed to sell out to Spear Leeds because they wanted to retire, according to sources.
ABDICATION OF REGULATORY POWER?
Big Board officials insisted there was no link between the change of their concentration rules and this acquisition. They noted that the...