Gain Capital Holding Inc, the global online trading firm that specialises in CFDs, FX and UK spread betting, has finally acquired City Index. Interestingly, City Index is also a leading online trading firm, therefore will this acquisition bring Gain capital a formidable combination, since the global leader will firmly extends it brand on the online financial markets.
Additionally, Gain Capital will be extending its reach and expanding its product portfolio through the acquisition of City Index. Reports show that both firms will have over $1.1 billion in clients’ assets with over $3 trillion annual trading volumes.
The purchase price on aggregate is approximately US$148 million, with US$36 million in cash inclusive. This shows approximately US$21 million of excess regulatory capital at City Index. US$60 million in convertible loan notes, issued by the Company, but also 319,149 shares of Company common stock. The net purchase price paid was approximately US$77 million, reflecting US$71 million of cash on City Index’s balance sheet.
Glenn Stevens, CEO of GAIN Capital expressed his enthusiasm for the deal with the statement;
“The closing of this transaction marks another major milestone in the growth of GAIN Capital and we are excited by the complementary strengths that have been brought together through this combination. The scale, scope of products and geographies served and market leading technology provided by the combined company provides us with an excellent platform for continued growth and success,”