Failed Merger Talks Led to NASD Plan; Exchange Chiefs Saw Need to Revive Effort
The planned takeover by the National Association of Securities Dealers of the American Stock Exchange has its roots in failed merger talks held last summer, according to industry and other sources familiar with the talks.</br></br>Only after NASD Chairman Frank Zarb and Amex Chairman Richard Syron gave up on an overly ambitious attempt to combine the two markets did the veteran Wall Street executives find a more successful path -- to maintain the Amex as a separate exchange from the Nasdaq Stock Market, the sources said.</br></br>Under the current proposal, hatched during a chance meeting at an industry function in November in Boca Raton, Fla., the Amex would live on as a separate subsidiary, and companies would choose whether to list their shares on the Amex or the Nasdaq.</br></br>The initial collapse and subsequent revival of the negotiations between Zarb and Syron demonstrates the importance of the deal to both men and the securities markets they run.</br></br>Zarb realized he needed a merger to better mount a global challenge to the mighty New York Stock Exchange, the biggest and most prestigious in the world. Syron decided that the Amex was not a viable market for the 21st century.