Fresh out of the oven: Gain Capital Files $125M IPO (Updated)

That’s got to be one of the leading contestants for the biggest news of the year (I’m awaiting official confirmation).

That’s got to be one of the leading contestants for the biggest news of the year (I’m awaiting official confirmation).

Streetinsider brings this laconic report:

Join the iFX EXPO Asia and discover your gateway to the Asian Markets

The offering is being made through Morgan Stanley and Deutsche Bank.

Gain Capital owns and is an online provider of retail foreign exchange trading and related services founded in 1999 by a group of experienced Wall Street trading professionals. We offer our customers 24-hour direct access to the global over-the-counter, or OTC, foreign exchange markets, where participants trade directly with one another rather than through a central exchange or clearing house.

More details tomorrow, hopefully.

RTT News brings more details – Gain no longer active in China (we already knew that) and losses money in 2009 (this is new):

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Additionally, the company said in the filing that since 2006, a major portion of its trading volume, trading revenue, net income and cash flow were generated from residents of China. However, last year the company became aware of a China Banking and Regulatory Commission, or CBRC, prohibition on forex trading firms providing retail forex trading services to Chinese residents through the Internet without a CBRC permit.

” We do not have such a permit and to our knowledge, no such permit exists,” Gain Capital said, adding that due to regulatory uncertainty, it decided to terminate service offerings to residents of China and ceased its trading support operations located in that country. As of December 31, 2008, the company no longer accept new customers or maintain direct customer accounts from residents of China, it added.

(This is a nicely put version of what really happened according to my sources who claim that Gain was asked to leave China due to aggressive marketing, the above mentioned confirms that Gain has been pulling a lot of money out of China.  Alpari recently ran into a similar problem.)


The company, founded in 1999, grew its annual net revenue from $22.2 million in 2004 to $190.8 million in 2008. The company said its net income grew from $7.1 million in 2004 to $231.4 million in 2008, representing a compounded annual growth rate of 138.9%.

For the six months ended June 30, 2009, the company reported a net loss applicable to the company of $48.71 million, compared to a profit of $135.27 million in the previous year period. On an adjusted basis, earnings dropped to $13.25 million or $0.89 per share from $21.93 million or $1.46 per share in the previous year. Reflecting the absence of Chinese operations, net revenue for the latest period declined to $77.88 million from $88.72 million generated in the year-ago period.

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