Ebb & Flow

When NASDAQ paid about $14 million for a 58% stake in the Belgium-based EASDAQ market in April 2001, it said the aim was to create a European IPO market that would include U.S. and Asian equities. In addition, NASDAQ said the move would expand and consolidate European order flow in NASDAQ-listed and other U.S. stocks.

Ironically, these reasons are similar to those cited in NASDAQ's Thursday restructuring announcement, under which NASDAQ-Europe will be wound down by Jan. 5, 2004. NASDAQ said the restructuring will help it to focus on increasing its share of IPO companies and trading volume, and in bringing in listings from other exchanges. In addition, NASDAQ will reduce its headcount by 80 people. For the first quarter, NASDAQ's revenue fell 22% to $165.9 million from $211.3 million year over year. First quarter revenues also were about 10% lower than the $183.5 million posted in the fourth quarter of 2002.

Seven biotech companies from the U.K., Europe and the U.S. were listed on EASDAQ prior to NASDAQ's acquisition of a majority stake in the exchange. Since then, all the companies have dual listed or left as the market lost investor confidence because of thin volume and unclear reporting of stock moves. Indeed, at the time of the acquisition, EASDAQ insiders were saying a key driver of the deal was NASDAQ's desire to get its hands on EASDAQ's trading platform, and rather than NASDAQ's interest in sustaining the exchange.

As of last Friday, the only biotech companies

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