KCG Holdings announced today that it has entered into a definitive agreement to sell certain assets and liabilities related to its Futures Commission Merchant (KCG Futures) business to Wedbush Securities Inc. The terms of the transaction were not disclosed. The transaction, which is subject to customary closing conditions and regulatory approvals, is expected to be completed by year end.
A division of KCG Americas LLC, KCG Futures, provides futures execution, clearing and custody services. KCG Futures facilitates futures and commodities transactions among brokers, institutions, market professionals and non-clearing FCMs on major US and international futures and options exchanges, as well as FX clearing.
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Wedbush Securities Inc. is a privately held financial services and investment firm that provides private and institutional brokerage, investment banking, equity research, fixed income, public finance, correspondent clearing and asset management to individual, institutional and issuing clients.
“KCG Futures is a leading independent futures broker and has maintained a solid reputation for high-quality client service,” said Daniel Coleman, CEO of KCG. “This transaction is a positive development for everyone involved. KCG Futures will join the Wedbush team, where it can further position itself as a leader in the marketplace, allowing Wedbush to expand its futures clearing and execution services. The transaction not only reduces and simplifies KCG’s balance sheet, it also allows us to focus additional resources and energy on our primary businesses of market-making, agency execution and trading venues.”
Closely following the transaction, KCG says it will continue to engage in futures market-making. It is anticipated that the existing KCG staff, comprised of approximately 45 professionals in the US, will continue in their current roles and client contacts will remain the same. KCG was advised on the transaction by the law firm Sullivan & Cromwell LLP.