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March 1, 1999

BRASS and TCAM Systems Enter Into Separate Mergers

By Michael L. O'Reilly

Two electronic Nasdaq order-routing vendors, including the operator of industry-leader BRASS, were purchased last month in separate deals.

New York's TCAM Systems was bought by Swedish trading-technology vendor OM Technology in a deal with an estimated value of under $20 million.

Weehawken, N.J.-based Automated Securities Clearance Corp., operator of BRASS, was purchased by Wayne, Pa.'s SunGard Data Systems. A spokesperson for SunGard, citing company policy, would not comment on the acquisition until it is finalized this month.

The spokesperson did say that Automated Securities would be operated independently, with SunGard planning to upgrade its support department.

BRASS is Automated Securities' leading product, and is used on most Nasdaq trading desks, routing more than 500,000 trades every day. Those trades represent 50 percent of all Nasdaq order flow.

More than 150 broker dealers currently subscribe to BRASS, including Morgan Stanley, Dean Witter & Co., Fidelity Brokerage and Knight/Trimark Group.

Automated Securities is also the majority owner of BRUT officially called the BRASS Utility an electronic communications network. BRUT currently has 95 subscribers, and averages more than six million shares a day.

SunGard said it hoped to increase BRUT's order flow by marketing it directly to asset managers.

That strategy could cause problems, some experts say, as BRUT has previously allowed only broker dealer-sponsored connections. BRUT's co-owners include four major broker dealers: Goldman, Sachs & Co., Knight/Trimark, Merrill Lynch & Co. and Morgan Stanley, Dean Witter.

TCAM Systems had been searching for a partner since August, when previous parent Stratus Computer spun off the order-routing operator. Marlboro, Mass.-based Stratus was acquired in August by Alameda, Calif.'s Ascend Communications in a $822 million deal.

Although not nearly as successful as BRASS, TCAM Systems is used by many top U.S. brokerage firms. It counts 16 exchanges as clients, including the Chicago Board Options Exchange.