NASD Announces Agreement-in-Principle with EDS to Create NasTech Alliance
Washington, D.C.—The National Association of Securities Dealers, Inc. (NASD®), today announced an agreement-in-principle with EDS Corporation of Plano, Texas, to create a strategic alliance, called the NasTechSM Alliance, to provide state-of-the-art technology services to NASD Regulation, Inc., and to the NASD parent business unit. The potential new alliance would build on the legacy of technology innovation and industry leadership of the NASD and EDS while creating increased efficiencies for the NASD and NASD RegulationSM.
Operations and technology of The Nasdaq Stock Market® would not be affected by the proposed alliance.
Given the dramatic growth in the volume and complexity of the NASD’s operation in recent years, the NasTech Alliance would provide the NASD and NASD Regulation with a strategic technology capability to maintain a leadership role in the rapidly expanding securities marketplace.
Over the next several months the NASD and EDS will evaluate the viability and the extent of the partnership, targeting a launch in first quarter of 1999.
Combining the NASD’s unique industry position and strategic technology vision with EDS’s extensive reach and operational expertise, the NasTech Alliance would be one of the largest such alliances in the securities industry and the first in the exchange marketplace, realizing significant cost efficiencies over 10 years.
In support of the NASD parent business unit and the NASD Regulation subsidiary, NasTech would be responsible for applications development and maintenance, Internet and intranet development, Web hosting, and distributed systems support, among other programs. In addition, NasTech would manage NASD’s ongoing vendor relationships, including RDA, SRA, TCS, Sequent, and Comsys.
"The creation of the NasTech alliance represents a strategic next step for the NASD as a technology leader. What we are proposing is a marriage of the NASD’s knowledge of the markets and leadership in regulatory technology with EDS’s proven track record for delivery and technical leadership," said Frank G. Zarb, Chairman and Chief Executive Officer of the NASD.
"This strategic alliance between the NASD and EDS is significant because it will combine the strengths of two industry leaders who share a common vision. The alliance will effectively enhance the impact of the NASD’s charter to protect investors and member firms to the benefit of the investment community," said Michael T. Reddy, Chairman and Chief Executive Officer, EDS’s New York-based Global Financial Markets Group.
"NASD and NASD Regulation have critical needs to respond rapidly to technological and operational issues as the markets expand and become more complex. This will enhance our ability to continue to be a leader in regulation technology to the direct benefit of the market and the investing public," said Mary L. Schapiro, President, NASD Regulation.
EDS, the official information technology services provider for World Cup1998, is a leader in the global information services industry. The company’s more than 110,000 employees specialize in applying a range of ideas and technologies to help business and government clients improve their economics, products, services and relationships. EDS, which serves clients in 45 countries, reported revenues of $15.2 billion in 1997. Visit EDS via the Internet at http://www.eds.com.
The National Association of Securities Dealers is the largest securities-industry, self-regulatory organization in the United States. Through its subsidiary, NASD Regulation, Inc., the NASD develops rules and regulations; provides a dispute resolution forum; conducts regulatory reviews of members’ activities; and designs, operates, and regulates securities markets all for the benefit and protection of investors.