Archipelago/NYSE Merger

The $9 billion merger between the New York Stock Exchange and Archipelago Holdings, Inc. created a new publicly held corporation, NYSE Group Inc., which has the capability to trade NYSE- and Nasdaq-listed stocks, as well as other stocks and financial instruments, through Archipelago's electronic trading system. During the merger approval process, Analysis Group academic affiliate Robert Pindyck conducted analysis showing that anti-competitive objections to the merger should not come into play due to the overall competitiveness of the market. His analysis highlighted the sophistication of stock exchange customers and their ability both to compete with existing exchanges themselves (e.g., through order internalization) and to sponsor entry by new competitors.

His analysis also identified the role of new regulation and technological advances in lowering barriers to entry and expansion by competitors. An Analysis Group team including CEO and Chairman Martha Samuelson, Managing Principal Rebecca Kirk Fair, and affiliate David Mishol supported Professor Pindyck in his analyses, conducting research on customers, actual and potential competitors, and regulatory context, as well as analyzing data on stock transactions.