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EXHIBIT 99.1
Monday May 15, 9:43 am Eastern Time
Company Press Release
E*Trade and Wit SoundView Form Strategic Alliance
Wit Capital Group to Acquire E*OFFERING, Creating Next Generation Investment
Banking Firm
NEW YORK and MENLO PARK, Calif.--(BUSINESS WIRE)--May 15, 2000
- Agreement Leverages Complementary Strengths in Investment Banking, Research,
Technology, Online Brokerage and Marketing to Create Powerful Category Killer
- Wit SoundView to Become Exclusive Source of IPOs, Follow-On Offerings and
Other Investment Banking Products to E*TRADE's 2.6+ Million Accounts
- E*TRADE Customers Gain Access to Expanded Range of Investment Products and
Opportunities, Including Wit SoundView's Proprietary -Research
- E*TRADE to Acquire Wit SoundView's Brokerage Accounts
- E*TRADE And General Atlantic Each to Purchase 2 Million Additional Shares of
Wit Capital Group Common Stock
Moving aggressively to advance the online investment banking and financial
services revolution that they helped to start, E*TRADE Group, Inc. (Nasdaq: EGRP
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- news) and Wit SoundView, the online investment banking subsidiary of Wit
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Capital Group, Inc. (Nasdaq: WITC - news), today announced a strategic alliance
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that leverages complementary core strengths and state-of-the art technology to
create a powerful new force in capital markets.
Wit Capital Group has also signed a definitive agreement to acquire E*OFFERING,
resulting in the dominant online products and technology provider in the
investment banking industry. The acquisition combines Wit SoundView's strengths
in deal origination, its unique research model and strong institutional
capabilities with E*OFFERING's robust technology platform, innovative product
capabilities and significant presence in Silicon Valley. Under the terms of the
transaction, E*OFFERING shareholders will receive approximately 32 million
shares of Wit Capital Group, representing approximately 25 percent of Wit
Capital's fully diluted shares. Pro forma for the transaction, E*TRADE Group,
General Atlantic and SOFTBANK will collectively own over 25 million shares of
Wit Capital Group, approximately 20 million of which will be subject to a three
year restriction on sale. Christos M. Cotsakos, Chairman of the Board and Chief
Executive Officer of E*TRADE Group, Inc. and Bill Ford of General Atlantic
Partners will join Wit Capital Group's board of directors.
As part of the strategic alliance, Wit SoundView will be the exclusive source of
IPOs, follow-on offerings and other investment banking products to E*TRADE, and
E*TRADE will acquire Wit SoundView's retail brokerage business, representing
approximately 100,000 accounts. In
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addition, E*TRADE will purchase two million shares of Wit Capital Group common
stock. E*TRADE's 2.6 million customers -including Wit SoundView's retail
customers - will gain access to a broad range of products and services, such as
world-class securities research, the opportunity to apply for participation in a
range of Internet and technology-related IPOs, follow-on offerings, private
placements and VostockSM, the innovative online auction system announced last
week by Wit SoundView and ITG Inc.
"With this strategic alliance, we are creating an Internet-driven category
killer that offers investors an expanded world of financial opportunities that
we believe will re-revolutionize the financial services space," said Cotsakos.
"The agreement provides strong value to our customers, who will now be able to
capitalize on a greatly expanded array of products and services. And, by
leveraging the complementary strengths of these organizations, our new alliance
with Wit SoundView will also deliver incredible value to our collective
shareowners, investors and associates."
"The E*OFFERING acquisition and our exclusive strategic alliance with E*TRADE is
another step in the evolution of our corporate strategy," said Ronald W.
Readmond, Vice Chairman, President and Co-Chief Executive Officer of Wit
SoundView. "It represents an aggressive move, catapulting Wit SoundView to the
next level and positioning us to compete successfully for lead manager roles in
Internet and new technology offerings. By leveraging world-class technology,
outstanding research, investment banking talent, superior institutional and
retail distribution channels, and a significant presence in the key Silicon
Valley and Silicon Alley markets, we will be superbly positioned to help new
economy companies gain access to the capital they need."
"This combination of E*OFFERING and Wit SoundView rapidly accelerates the
execution of our shared vision to bring high-quality investment banking products
and services to the online investing marketplace," said Steve King, interim
President and Chief Executive Officer of E*OFFERING. "This transaction is
uniquely complementary and allows Wit SoundView to integrate E*OFFERING's
product and technology platform - including an innovative private placement
concept and online pre-IPO presentations - with their world-class research and
institutional capabilities. Ultimately, this new alliance provides E*TRADE
customers with a larger product supply and the opportunity to apply for access
to an expanded variety of online offerings."
"We are extremely pleased to have helped bring together these leading companies
in a strategic relationship that represents a tremendous opportunity for
advancing technology-enabled capital raising worldwide," said Mark Dzialja,
Partner of General Atlantic Partners, LLC, which is a major investor in both
E*TRADE and E*OFFERING. "This alliance leverages Wit SoundView's strong on-line
investment banking franchise, E*TRADE's distribution capabilities and
E*OFFERING's industry leadership as an e-manager. It truly represents the next
generation in investment banking and financial services."
Wit SoundView's acquisition of E*OFFERING is expected to close in the third
quarter of 2000, subject to shareholder approval, Hart-Scott-Rodino clearance
and other customary conditions. Goldman Sachs & Co. acted as strategic and
financial advisor to Wit Capital Group and also provided a fairness opinion to
the Company's Board of Directors.
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About E*TRADE
E*TRADE, a global leader in online personal financial services, is the world's
most-visited online investing site according to Media Metrix (2/00), offering
value-added investing and research features, premium customer service and a
redundant, proprietary Stateless ArchitectureSM infrastructure. In addition to
the US, E*TRADE presently serves customers through branded web sites in Denmark,
Korea, Japan, the U.K., Sweden, France, Australia, New Zealand and Canada.
E*TRADE has been recognized as a leader in online financial services by Gomez
Advisors, Lafferty Information and Research Group, PC Magazine and Smart
Computing magazine. E*TRADE Securities Inc. (Member NASD/SIPC), and its parent
company, E*TRADE Group, Inc. have offices in Northern California and in other
major business centers in the US and worldwide. E*TRADE is a registered
trademark of E*TRADE Securities, Inc.
About E*OFFERING
E*OFFERING (member NASD/SIPC), headquartered in San Francisco, was founded in
January of 1999 with the objective of democratizing the capital markets. It
successfully enables its issuers to access and use capital more effectively by
leveraging the broadest investment community of retail and mid- and top-tier
investors available. E*OFFERING has combined financial expertise, top-notch
people, Internet infrastructure, and business model to enable this. Funding for
E*OFFERING was provided by E*TRADE Group, Inc., General Atlantic Partners,
SOFTBANK Venture Capital, New Enterprise Associates, Battery Ventures,
Crosspoint Venture Partners, Sandy Robertson, founder and former CEO of
Robertson Stephens, and Walter Cruttenden, founder and former CEO of Cruttenden
Roth.
About Wit Capital Group, Inc.
Wit Capital Group, Inc. (NASDAQ: WITC - news) is the parent of online investment
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banking group Wit SoundViewSM. Wit SoundViewSM was created in early 2000 when
Wit Capital joined with SoundView Technology Group, Inc. Wit SoundViewSM is the
largest online investment banking group focused exclusively on the Internet and
technology sectors. Wit SoundViewSM offers a strong complement of investment
banking services, from Internet-strategic advisory, venture capital and private
equity placements, to public offerings and M&A advisory. With one of the largest
research teams in the sector, Wit SoundViewSM produces comprehensive sell-side
research on over 285 Internet and technology companies, developed for our online
and institutional audiences.
Wit SoundViewSM is recognized as one of the first firms to bring online
individual investors directly into the capital formation process and continues
to leverage the Internet to revolutionize the way in which issuers and investors
communicate. For more information, please see www.witsoundview.com.
-Wit SoundViewSM is a service mark of Wit Capital Group, Inc. Services are
offered through Wit Capital Corporation and Wit SoundView Corporation. Members
NASD/SIPC
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Contact:
Jennifer DiClerico, (212) 253-4481
[email protected]
or
E*TRADE Group, Inc.
Jacqueline Russo, (650) 331-5789
[email protected]
or
E*OFFERING
Rich Horn, (415) 618-6627
[email protected]
