Sunday, Jun 24, 2018
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Stock Market

Threatened brokerage lines up Wall St. lenders

NEW YORK — Knight Capital Group survived a near-death experience Monday, lining up Wall Street firms to lend to it. The brokerage lost $440 million last week when a malfunction in its trading system flooded the market with erroneous trades.

But the new investors, led by the Jefferies Group, as well as Blackstone, a big private equity firm will gain a 73 percent stake in the company, which takes orders from big brokers such as TD Ameritrade and E-Trade, and will receive three board seats.

And Knight still faces a difficult task of rebuilding trust with clients and convincing regulators that Wednesday's disaster was an anomaly.

Its stock has plunged 70 percent since last Tuesday, before the glitch happened.

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