Marex acquires HK broker Global Metals Network (GMN)
London-headquartered commodities broker Marex has acquired Global Metals Network (GMN), a market maker specializing in recycled metals based in Hong Kong.
With a focus on serving clients in Asia, GMN brings regional expertise and coverage to Marex’s existing recycled metals offering. The financial terms of the deal were not disclosed.
Marex said the deal represents a superb opportunity for corporate backing and consolidation with a worldwide growing leading player. It should therefore pave the way for future ambitious business development steps by benefiting from access to Marex’s global infrastructure and balance sheet.
Marex also recognizes the growth potential in providing environmental products that support the transition to a low carbon economy. In 2022, the company generated $26 million in revenue from such products. The acquisition of GMN will expand client coverage, enhance supplier networks, and contribute to revenue growth, it added.
This acquisition aligns with Marex’s strategy of increasing the scale, diversification, and global presence of its environmental products. Marex has a proven track record of acquiring businesses and enabling their growth.
Ian Lowitt, CEO of Marex, commented: “Our commitment to supporting our clients as they navigate the transition to a low-carbon economy continues to be a core priority for Marex, and the acquisition of GMN bolsters our extensive offering in environmental products. The GMN team bring regional expertise, a strong client base across Asia and a risk profile that is complementary to the standards we set at Marex. It is a good strategic fit with our existing recycled metals business, Tangent, and I am excited by what we will achieve with an enhanced global footprint in such an important and growing sector.”
Marex is one of the world’s largest privately owned commodities brokers and is reportedly considering an initial public offering (IPO) of its shares in the future. The company already owns Tangent Trading, another London-based firm focused on trading copper and other non-ferrous scrap metals.
The commodities boom has fueled stellar results for the market making and execution segment, and also boosted volumes for the clearing business. Clients’ activity at Marex, which connect its traders to commodity, energy and financial markets, has surged even more since Russia’s invasion of Ukraine.
Although that pressures the broker to maintain higher cash reserves, clients’ monies leapt to $12.9 billion by 30 December 2022, up 139 percent from a year earlier. This included $4.5 billion of client assets added with the ED&F Man Capital Markets acquisition.
Rising energy and commodity prices lifted performance in the previous with economies reopening after pandemic lockdowns, but market conditions normalised in the second quarter amid higher interest rates, the broker notes.
From March 2021 Marex Spectron has shorted its name to Marex. The Marex Spectron name dates back to 2011, when Marex acquired Spectron, the OTC energy broker. Since then, the business has vastly increased in scale, scope and headcount, with multiple new offerings and business lines.