TP ICAP plc has confirmed that it has agreed on definitive terms to acquire the entire issued share capital of Liquidnet Holdings, Inc. for a total consideration of between $575 million and $700 million.
October 9, 2020 | AtoZ Markets –TP ICAP plc (LON:TCAP), the world’s biggest inter-dealer broker on Friday confirmed that it will acquire New York-based electronic trading network Liquidnet Holdings Inc for a price ranging from $575 million to $700 million.
TP ICAP expects to complete Liquidnet acquisition in Q1 2021
Liquidnet specializes in equities dark trading, with a growing presence in fixed income. For the year to the end of June, Liquidnet generated adjusted earnings before interest, tax, depreciation, and amortization of $64 million, on revenue of $339 million.
The payment comprises an upfront consideration of $525 million on the completion of the deal, and deferred consideration of $50 million. TC ICAP will pay up to a further $125 million depending on the performance of the Liquidnet Equities business over the three-year period from the start of 2021.
TP ICAP expects to pay $100 million in cash funded from its existing debt facilities on the completion of the deal, and then $425 million in cash, raised through a rights issue, which will be fully underwritten by HSBC Bank PLC.
The remaining $50 million would be funded from senior secured loan notes issued on completion to certain Liquidnet stockholders.
TP ICAP expects to complete the deal in the first quarter of 2021.
“Acquiring Liquidnet is a unique opportunity to transform TP ICAP’s growth prospects by materially accelerating the execution of our electronification, aggregation and diversification strategy. Liquidnet is a premier, technology-driven, global electronic trading network with more than 1,000 buyside clients. It has a strong and trusted brand, which we will both retain and develop. We will continue to invest in, and grow, Liquidnet’s leading dark/block Equities business, and maintain its position as a trusted and unconflicted agency broker,” said Chief Executive Officer Nicolas Breteau.
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