Final M&A deal of 2016! Tullett Prebon adds to voice brokerage by buying ICAP’s broking business for $1.28 billion

Marking the end of the year, a large-scale M&A deal has completed between Tullett Prebon and ICAP, expanding Tullett Prebon’s voice brokerage business and allowing ICAP to concentrate on electronic markets and specialist services including post-trade settlement

British interdealer broker ICAP go from strength to strength

This is the final business day of 2016, however it has not stopped large electronic and traditional brokerage stalwarts from continuing to complete vital acquisitions.

FinanceFeeds predicts that 2017 will be a year of mergers and acquisitions at high level, as detailed in our research on the year ahead, however today’s finalization of a large deal is one that strengthens a very traditional aspect of the brokerage business, that being voice brokerage.

London’s Tullett Prebon, one of the largest voice brokerage firms that remain in existence, has acquired the entire global brokerage division of ICAP, including its brand name.

This is the completion of a deal that has been on the cards for quite some time, with a notable aspect of it being the renaming of British interdealer broker ICAP to NEX Group PLC once it has sold its global brokerage business to Tullett Prebon which completes ICAP’s transformation into a specialist in electronic markets and post-trade settlement and processing services via its EBS BrokerTec and Traiana divisions.

ICAP CEO Michael Spencer had stated in May this year that the ICAP brand would be included in the £1.1 billion transaction to offload the entire ICAP Global Broking business, however the deal was expected to complete in November rather than the end of this year, however the deal which has now concluded is actually worth £1.28 billion, as confirmed by a conversation between FinanceFeeds and a spokesperson on the deal today.

The transaction has been completed on an all-share basis, meaning that no cash transaction was involved, and the acquisition was completed using share capital.

Last month Tullett Prebon received approval from the Financial Conduct Authority to proceed, which meant the ICAP brand was transferred to Tullett Prebon and the new group was renamed NEX Group.

“This deal creates the leading interdealer broker in the world. It is a transformational acquisition for TP ICAP, providing a unique opportunity to accelerate our strategy and deliver for our clients, our employees and our shareholders,” said TP ICAP CEO John Phizackerley.

Stuart Bridges, ICAP’s finance director today stated “We are seeing the contracting of the banks’ balance sheets and an ongoing reduction in worldwide volumes, It’s quite a tough environment for that business.”

Tullett Prebon plans to make the combined voice-broking business more profitable by cutting infrastructure, technology and operations costs. While the company may decide to reduce the number of voice brokers after completing the acquisition, it has no plans to do so during the first year of life for the combined business.

Read this next

Market News

Rishi Sunak’s reign in real data

After several weeks of Rishi Sunak’s appointment as the new Prime Minister, it is obvious that he has claimed quite the public support.

Digital Assets

CrossTower acquires BEQUANT to help crypto industry reset and consolidate

“We are stabilizing an industry with incredible promise; regaining trust; and rebuilding the future of finance.”

Retail FX

Plum launches crypto offering for EU residents

Plum has added crypto investing to its range of investment options in France, Belgium, Spain, and Ireland. Residents there will be able to buy and sell cryptocurrencies in their app with just a few taps, via services provided by Bitpanda.

Retail FX

FX/CFD and Crypto broker Quantfury launches fractional trading of stocks, ETFs, commodities

“Quantfury is advancing its unmatched trading and investing conditions further by making it even more affordable to Quantfurians out there. Fractional trading mode opens up more trading opportunities to the Quantfury global audience of more than 400,000 Quantfurians.”

Industry News

SEC awards $20 million to whistleblower despite degree of culpability and reporting delay

The Securities and Exchange Commission has awarded a whistleblower with $20 million for providing new and critical information that led to the success of an enforcement action.

Institutional FX

Tradesmarter’s white label WOW TRADER integrates with TradingView

Tradesmarter’s white label trading platform solution WOW TRADER has integrated with TradingView, the high performance and mobile friendly charting tool.

Industry News

ASIC loses fee overcharging case against Commonwealth Bank of Australia

“ASIC pursued this case because we believed CBA did not have robust compliance systems to ensure customers were being correctly charged. ASIC will carefully consider the judgment and continue to work to ensure large financial institutions charge fees correctly and put their customers first.”

Digital Assets

Kraken pays $362K fine for onboarding Iranian users

Cryptocurrency exchange Kraken will pay $362,158 to settle its civil liability for apparent violations of US sanctions on countries like Iran, the Treasury Department’s Office of Foreign Assets Control said.

Digital Assets

Bankrupt lender BlockFi owes $275 million to FTX.US

Distressed crypto lender BlockFi has filed for Chapter 11 bankruptcy protection, nearly two weeks after halting withdrawals of customer deposits due to significant exposure to bankrupt exchange FTX.

<