TP ICAP to Acquire Liquidnet for up to $700 Million

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 MarketsTP 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.

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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.

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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.

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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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