Breaking: GAIN Capital to Raise up to $92m for Buybacks and Acquisitions

GAIN Capital (NYSE:GCAP) has just announced that it is preparing to offer a new batch of convertible senior notes. The brokerage is going to offer $80 million worth of paper with an additional 30 day option for another $12 million to cover potential over-allotments.

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The sale is going to refinance existing Obligations Obligations In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you Read this Term and provide for a $15 million buyback program. The notes will be convertible at the option of holders until the 15th of April 2022.

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GAIN Capital’s (NYSE:GCAP) new debt issue will also be used to relay existing obligations and add to the broker’s balance sheet as it looks for “strategic acquisitions” and additional share buybacks. The company has hired JPMorgan and Jefferies as joint book-running managers of the offering.

As of the end of the second quarter of 2017, GAIN Capital (NYSE:GCAP) reported that the company's total Liquidity Liquidity The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent Read this Term amounts to $135.8 million.

GAIN Capital has conservatively retained excess capital over the regulatory requirements and recently obtained a revolving credit facility worth $50 million.

The company has successfully completed and integrated 10 acquisitions over the past 5 years and has been consistently returning money to shareholders in recent quarters.

Recent quarters have been difficult for GAIN Capital's (NYSE:GCAP) arch rival listed in the US, FXCM (NASDAQ:FXCM). The company recently announced the closure of the sale of its stake in Fastmatch to Euronext. FXCM still owes Leucadia National $66.8 million. Speculation about the company's future as a listed company has been ramping up in recent months.

Earlier this year GAIN Capital (NYSE:GCAP) purchased FXCM's US accounts.