Breaking Update From FBN:
-VIRTU OUT OF BIDDING FOR KNIGHT CAPITAL
-KNIGHT’S JOYCE CONSIDERING BANKRUPTCY REORGANIZATION
-KNIGHT LOOKING AT ‘363’ REORGANIZATION TO SELL ASSETS
-KNIGHT LOOKING TO EMERGE AS VIABLE COMPANY
The botched Facebook Inc (NASDAQ:FB) IPO earlier this year, hit Knight Capital Group Inc. (NYSE:KCG) like a ton of bricks, costing them over $35 million in losses. However, that was nothing compared to the losses endured yesterday and this morning, after the marketing computer system failed again.
A technical glitch in an algorithm on one of Knight’s marketing computers, caused it to mishandle 150 shares of NYSE stock. The mishap has turned the company’s liquid assets into just that. Their funds are pouring out like water from a strainer, and there seems to be no way to staunch the flow.
Analysts estimate that Knight ha suffered a loss more than ten times that which they suffered following the Facebook Inc (NASDAQ:FB) fiasco.
CEO, Tom Joyce, spoke with Erik Schatzker and Stephanie Ruhle on Bloomberg’s “Market Makers” this morning. He said in view of yesterdays mishap, “We understand what the issues are.” He said this was an anomaly, a very unusual occurrence, but in light of recent history. I am inclined to believe otherwise. This event has left analysts and investors alike, shaking their heads and wondering if Knight can ever recover from this loss.
When he was asked if the company would be able to pull itself out of the pit it has fallen into over the last 24 hours, he was half hearted at best. He would not confirm that Knight Capital Group Inc. (NYSE:KCG) will make the climb back to the social status it held a few short days ago, but pointed out that they are looking for new sources of capital.
As Knight Capital Group Inc. (NYSE:KCG)’s employees scramble to protect their investors, the whole world watches and waits in wonder. Will they be able to make it back? We will keep you posted as new information arrives with each passing minute.
