Discount broker E-Trade Financial announced Tuesday it would acquire Massachusetts-based asset manager Kobren Insight Management for an undisclosed amount.

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The deal, which came just 24 hours after the online giant scooped up rival HarrisDirect for $700 million in cash, advances E-Trade's wealth management business and transforms the company into a full-service financial services firm. E-Trade officials said they expect the deal to contribute close to $10 million in revenues and $2.3 million in net income in 2006.

A registered investment advisor, Kobren Insight manages about $1 billion in assets and serves as the investment advisor to the Kobren Insight Funds from the Kobren Insight Group. It is run by Eric Kobren, a former Fidelity Investments group marketing director popularly known within the industry for publishing Fidelity Insight, a monthly newsletter devoted to the Boston fund giant.

Kobren and his group's managing director, Rusty Vannerman, as well as six Kobren analysts, will join E-Trade. Other Kobren employees will remain with the company's various newsletters.

"E-Trade Financial seeks to enhance its advice and wealth management services by creating high-value tools and services targeted to each of our retail customer segments," said R. Jarrett Lilien, president and COO, E-Trade, in a statement.

"The [Kobren] acquisition will bring customer relationships that can be monetized through our cash, investment and credit solutions." Lilien said.

E-Trade has been at the leading edge of a flurry of consolidation in the brokerage industry, which has been suffering from fewer customer transactions since the dot-com bubble burst in 2000. In January, E-Trade acquired Howard Capital Management and this spring made an unsuccessful bid to buy Ameritrade, which answered the call by acquiring TD Waterhouse.

(c) 2005 Money Management Executive and SourceMedia, Inc. All Rights Reserved.

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