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Hedge Fund Mergers And Acquisitions: GAIN Capital Completes Acquisition of GFT

mergers-and-acquisitionsNew York (HedgeCo.Net) –  Hedge fund resource provider GAIN Capital Holdings, Inc., has completed the acquisition of Global Futures & Forex, LTD (“GFT”).

“The acquisition of GFT will yield numerous benefits for our clients, partners and shareholders,” said Glenn Stevens, Chief Executive Officer of GAIN Capital. “The combined company boasts a deeper global footprint, a robust offering of more than 12,500 financial products, and industry-leading trading technology.

Pro forma first half 2013 financials include:

  • Revenue of $190.0 million (GAIN Capital: $122.8 million; GFT: $67.2 million)
  • Pro forma1 trading volume through June 30, 2013 of $3.6 trillion (GAIN Capital: $2.8 trillion;
    GFT: $0.8 trillion)

    • Retail OTC: $1.3 trillion (GAIN Capital: $899.1 billion; GFT: $391.3 billion)
    • Institutional: $2.3 trillion (GAIN Capital: $1.9 trillion; GFT: $0.4 trillion)
  • Pro forma1 client assets as of June 30, 2013 of $683.8 million (GAIN Capital: $475.6 million;
    GFT: $208.2 million)

Highlights of the acquisition include:

  • Operating synergies of $35 million – $45 million in the first full year following closing
  • Acquisition expected to be accretive to fourth quarter 2013 earnings

Under the terms of the transaction, the purchase price is comprised of $40 million in cash, approximately 3.6 million shares of GAIN Capital stock and an approximately $33 million 5-year seller note.  GAIN received approximately $73 million of GFT cash at closing.

“We intend to use GFT’s broad product offering, innovative tools and educational capabilities to further strengthen our competitive position, while realizing significant synergies from combining the best of both organizations,” Stevens said. “This transaction is an important strategic step in solidifying our leadership position in the industry.”

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