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Virtu Financial expands its short-term borrowing capacity

Maria Nikolova

The company has amended its existing syndicated broker-dealer credit facility, increasing borrowing limits for clearing house margin by $150 million through June 30, 2020.

Virtu Financial Inc (NASDAQ:VIRT) today announced its preliminary results for the quarter to date and an expansion of its short-term borrowing capacity.

Douglas A. Cifu, CEO of Virtu Financial, explains:

“Given the sustained levels of extraordinary volatility in the current macro environment and the unique opportunity this affords Virtu to provide valuable liquidity to customers across the global markets and execution services to our clients, we consider it prudent to opportunistically supplement our borrowing capacity.”

The opportunistic borrowing capacity enhancements announced today are the result of the following transactions:

  • Entry into a $300 million 180-day committed credit facility with an affiliate of Virtu’s Founder and Chairman Emeritus, Mr Vincent Viola, together with a warrant agreement for the issuance of up to 10 million warrants to purchase Class A common shares of Virtu at a strike price to be calculated based on the Company’s stock price over a two week period following the publication of the Company’s first quarter results in May. Three million warrants are issuable at closing, with the balance issued following a draw of $100 million or more.

The transaction has secured the unanimous approval by Virtu’s disinterested directors.

  • Amendment of its existing syndicated broker-dealer credit facility, increasing borrowing limits for clearing house margin by $150 million through June 30, 2020.

On a preliminary basis, the company expects its results of operations for the quarter to date through March 19, 2020 to reflect:

  • Trading Income, net between $489 and $497 million;
  • Adjusted Net Trading Income between $509 and $519 million;
  • Average Daily Adjusted Net Trading Income between $9.43 and $9.61 million per day.

Virtu is set to report its results for the first quarter of this year on May 7, 2020.

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