Knight/Trimark Group Issues 10.5 Million Shares to Close Arbitrade Acquisition

JERSEY CITY, N.J., Jan. 12 /PRNewswire/ -- Knight/Trimark Group, Inc. (Nasdaq: NITE), the largest wholesale market maker in U.S. equity securities, has completed today its previously announced acquisition of Arbitrade Holdings LLC. Arbitrade is a technologically advanced options market maker and asset manager with operations in the U.S. and in Europe.

The transaction, which was accounted for as a pooling of interests, resulted in a newly formed parent holding company that issued shares on a tax-free basis to holders of Knight common stock and to the owners of Arbitrade. Under Delaware law, the Knight shares were automatically exchanged on a one-for-one basis for new parent company shares on January 6, 2000. As a result, Knight shareholders will not receive new stock certificates.

On January 12, 2000, Arbitrade's owners received approximately 10.5 million shares of the new parent holding company (approximately 8.6 percent of shares outstanding immediately following the transaction), the minimum number issuable under the price "collar" described in the merger agreement. After the transactions, the new parent holding company has approximately 122.1 million shares outstanding. Based on the closing price of Knight common stock on January 12, 2000, the value of the shares issued to Arbitrade's owners was approximately $393 million.

Following the transactions, Knight and Arbitrade became subsidiaries of the new parent holding company, which assumed the name "Knight/Trimark Group, Inc." and became the publicly traded Nasdaq company under the same ticker symbol (NITE). Arbitrade's options market making unit will change its name to "Knight Financial Products" within the next 60 days, subject to regulatory approval.

The Company filed a Form 8-K in connection with the closing of this transaction, which can be obtained via the Internet at http://www.knight-sec.com or http://www.sec.gov. The Form 8-K includes historical and pro forma financial information relating to Arbitrade and the acquisition.

SOURCE Knight/Trimark Group, Inc.

CONTACT: Marge Wyrwas, Vice President, Corporate Communications & Investor Relations of Knight/Trimark Group, Inc., 201-557-6954; or Russell Dubner, 212-704-4538, or Chuck Dohrenwend, 212-704-8102, both of Edelman Public Relations, for Knight/Trimark Group, Inc./