Ameritrade Holding Corp. is acquiring rival TD Waterhouse USA from Toronto-Dominion Bank in a $2.9 billion all-stock deal. The combined company will be called TD Ameritrade.

Ameritrade said that it expects the acquisition to be accretive within twelve months and expects to realize about $578 million of annualized gross synergies, including cost savings and increased revenue opportunities, within six quarters after the closing.

“The acquisition of TD Waterhouse U.S.A. is the right deal for Ameritrade,” said Ameritrade CEO Joe Moglia. “This opportunity accelerates our long-term investor strategy with access to branches and advice, while maintaining an industry leading pre-tax margin.”

“We expect that it will create significant value for shareholders by generating substantial cost synergies and deliver a more diverse revenue mix by shifting to an asset-gathering model,” added Moglia. “This exciting combination builds upon Ameritrade’s strong track record as a leading industry consolidator and creates an even more robust platform for future consolidation and growth.”

The combined company’s board of directors will include Ameritrade founder J. Joe Ricketts, who is also chairman of the combined company. It will also include vice-chairman Ed Clark, the CEO of TD Bank Financial Group, Moglia, J. Peter Ricketts, president and COO of TD Ameritrade and Thomas S. Ricketts. Other members will be selected before the acquisition closes.

“This transaction is a strategic and natural one for TD Bank Financial Group, as it provides immediate value to shareholders, reaffirms our commitment to the on-line brokerage business and extends our opportunities for further growth in the U.S.,” said TD Bank Financial Group President and CEO Ed Clark.

“By having our strong TD Waterhouse U.S.A. franchise become part of Ameritrade, TD has gained a significant stake in a powerful industry leader,” Clark continued. “a stake that gives us the opportunity to actively contribute to the strategic direction as TD Ameritrade grows and strengthens the TD brand in the U.S. Consistent with our history of aligning with well-run companies, Ameritrade has a strong management team whose expertise will benefit clients and shareholders alike.”

The two companies expect the transaction to reach completion within the next six months. It is still subject to approval by shareholders of Ameritrade, as well as regulatory approvals in the U.S. and Canada.

Chris is a staff writer for webproworld. Visit webproworld for the latest ebusiness news.