Jan. 8 (Bloomberg) -- TD Ameritrade Holdings Inc., the third-biggest U.S. online brokerage by assets, said it agreed to acquire Thinkorswim Group Inc. for about $606 million to tap into investor interest in the fast-growing options market.

The deal includes $225 million in cash and the issuance of about 28 million shares of TD Ameritrade common stock, the Omaha, Nebraska-based company said today in a statement. TD Ameritrade is paying about $8.71 a share for New York-based Thinkorswim, 54 percent higher than the closing price yesterday.

Chief Executive Officer Fredric Tomczyk is seeking to bolster TD Ameritrade’s appeal among active retail traders by adding a more sophisticated options trading platform. Thinkorswim increased accounts 82 percent last year through September to 87,025 helped by referrals from its investor education unit.

“This will advance our trading and investor education strategy by several years,” Tomczyk told analysts today in a conference call broadcast over the Internet. “We plan to take advantage of the current environment to build our competitive position.”

Ameritrade shares slipped 8 cents, or 0.6 percent, to $13.24 in composite trading on the Nasdaq Stock Market. Thinkorswim shares rallied $2.69, or 48 percent, to $8.34 for its biggest gain since July 2003.

Last year, shares of Thinkorswim tumbled 68 percent, more than twice the decline for TD Ameritrade, amid concern retail investors would lose interest in trading as the Standard & Poor’s 500 Index posted its worst yearly drop since 1937.

‘True Gem’

Thinkorswim net income through September surged more than 10-fold from a year earlier to $49.8 million as wider swings in stock prices fueled record options trading. Account growth accelerated helped by the 2007 merger of the investor education company Investools Inc. and the nine-year-old Thinkorswim brokerage, which was founded by two former market makers at the Chicago Board Options Exchange.

“Ameritrade acquired a true gem here,” said Richard Fetyko, an analyst at Merriman Curhan Ford & Co. in New York who has had a “buy” rating on Thinkorswim since starting coverage in April 2004. “They not only got the best technology on the options trading side, but also the best investor education company.”

The transaction will start adding to earnings in 2010 and boot profit by as much as 15 percent after the integration of the two companies in 2011, Ameritrade Chief Financial Officer William Gerber said in a conference call with analysts. The company plans to generate as much $55 million in cost savings and additional revenue primarily by expanding Thinkorswim’s investor education unit, he said.

TD Ameritrade plans to buy back roughly the same number of shares issued for the deal, which is expected to close in six months. The deal requires shareholder and regulatory approvals.

TD Ameritrade was advised by Merrill Lynch & Co. and the law firm of Wilson Sonsini Goodrich & Rosati. Paragon Capital Partners LLC and Cleary Gottlieb Steen & Hamilton LP advised Thinkorswim.

To contact the reporter on this story: Edgar Ortega in New York at ebarrales@bloomberg.net.

Last Updated: January 8, 2009 17:00 EST