Citicorp said Tuesday that it has offered to acquire Los Angeles-based Quotron Systems, a leading supplier of computer stock quotations and other financial information, for $680 million in cash.
The $19-per-share deal, if approved by Quotron's board and shareholders, is expected to provide Quotron with new financial resources to expand and fight increasing competition.
The firm, long rumored as a takeover target, confirmed last October that merger discussions were under way with an unnamed suitor. That suitor was in fact Citicorp, a spokesman for the New York bank confirmed Tuesday.
The merger also would provide Citicorp, the nation's largest banking firm, with yet another venture in the lucrative and fast-growing data-processing and information-services field.
Fits Citicorp's Strategy
The firm already participates in joint ventures in videotext, software and computerized investment information services, part of its strategy to develop computerized delivery of financial services.
"I . . . am convinced that Quotron can greatly accelerate its development and role in the information business as a part of Citicorp's family," Citicorp Chairman John S. Reed said in a letter to Quotron Chairman and Chief Executive Milton E. Mohr.
Mohr and other Quotron officials were in New York for a board meeting and were not immediately available for comment.
A Citicorp spokesman said merger discussions from last October had broken off, but new talks leading to the present offer began "very recently."
He added that the offer is intended to be friendly and that he expected the Quotron board to approve it, given the "friendly relationships" between Reed and Mohr, who are longtime friends.
The deal also is subject to Federal Reserve Board approval, which Citicorp said it expects within about 30 days.
In over-the-counter trading Tuesday, Quotron closed at $16.25 a share, up $1.125. Citicorp announced its offer after the market closed.
Citicorp said that it intends to operate Quotron as a separate subsidiary and that it hopes to retain existing management, particularly Mohr. The feisty 70-year-old executive has been credited with saving Quotron from near bankruptcy in the early 1970s and building it up into the industry leader.
Some 80,000 stockbrokers and others use Quotron's computer terminals, and Quotron's share of this market has hovered around 70%.
However, firms such as Automatic Data Processing and Reuters are entering the business or boosting their activities.
If the Citicorp-Quotron merger does not go through, Citicorp itself could be a potential competitor through a joint venture with McGraw-Hill, under which the firms offer computer services to commodities traders.