Breaking: Euronext Acquires 90% of FastMatch for $153m
- FXCM's stake in the company is initially worth $55.6 million, subject to additional conditions.
Euronext has become the latest exchange to enter the foreign exchange market. The company just announced the acquisition of 90 percent of FastMatch for $153 million. The deal comes after the Electronic Communications Network (ECN) Electronic Communications Network (ECN) Electronic Communications Network or ECNs are execution venues which are providing the infrastructure for matching buyers with sellers. Electronic trading is traditionally used in OTC products and outside of exchanges. An ECN normally functions as an electronic system that disseminates orders entered by market makers to third parties. In doing so, an ECN permits the orders to be executed against in whole or in part. The most common products that are traded on ECNs are stocks and currencies, maki Electronic Communications Network or ECNs are execution venues which are providing the infrastructure for matching buyers with sellers. Electronic trading is traditionally used in OTC products and outside of exchanges. An ECN normally functions as an electronic system that disseminates orders entered by market makers to third parties. In doing so, an ECN permits the orders to be executed against in whole or in part. The most common products that are traded on ECNs are stocks and currencies, maki Read this Term) for trading foreign exchange consistently outperformed its peers in the industry over the past couple of years.
The management of Fastmatch will continue to hold 10 percent of the company. In addition to the initial cash payment there is an additional earn-out payment of $10 million and customary minority rights.
As part of the deal, FXCM Group will sell its stake in the ECN for approximately $55.6 million. A portion of the amount will be held in escrow and will be subject to certain future adjustments including a share of a $10 million earnout if certain performance targets of FastMatch are met.
FastMatch Q1 Revenues Totaled $5.8 million
The fastest growing ECN in the industry has posted $5.8 million of revenue in the first quarter of 2017. The number is higher by 48.8 percent when compared to the first quarter of 2016. The company marked $2.4 million of EBITDA (earnings before interest, taxes, depreciation, and amortization) which is 3.6 times higher year-on-year.
Fastmatch is posting a 41.0 percent margin on its operations, with average daily trading volumes for the second quarter of the year coming in at $20.8 billion.
The acquisition will be financed via bank debt and is subject to regulatory approvals. The transaction is expected to close in the third quarter of 2017.
Euronext outlines that the deal is aiming to provide further product and geographic diversification for the company.
Dmitri Galinov
Commenting on the deal, the founder and CEO of FastMatch, Dmitri Galinov, outlined: “We will accelerate our vision of bringing transparency, best-in-class technology and Execution Execution Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Read this Term to FX markets globally. Our superior technology will serve as catalyst to Euronext’s strategic ambitions in growing into the FICC in Europe.”
The Chairman and CEO of the Managing Board of Euronext NV, Stéphane Boujnah, added: “The acquisition of FastMatch breaks new ground for Euronext, through expansion into the FX market which is the world’s largest traded asset class. This will broaden the spectrum of products we provide to capital market users, whilst meaningfully diversifying our revenue and creating long-term value and growth for customers and shareholders.”
“The combination of FastMatch’s in-depth FX expertise, leading technology platform, diverse customer base and entrepreneurial spirit with Euronext’s scale, strength and credibility, will position Euronext as a trustworthy infrastructure provider servicing a market where participants are increasingly looking for transparency, reduced capital costs, cutting-edge trading and long-term clearing solutions,” Boujnah added.
The Chairman of Euronext highlighted that the transaction is in line with the company’s Agility for Growth strategic plan announced in May 2016.
Euronext has become the latest exchange to enter the foreign exchange market. The company just announced the acquisition of 90 percent of FastMatch for $153 million. The deal comes after the Electronic Communications Network (ECN) Electronic Communications Network (ECN) Electronic Communications Network or ECNs are execution venues which are providing the infrastructure for matching buyers with sellers. Electronic trading is traditionally used in OTC products and outside of exchanges. An ECN normally functions as an electronic system that disseminates orders entered by market makers to third parties. In doing so, an ECN permits the orders to be executed against in whole or in part. The most common products that are traded on ECNs are stocks and currencies, maki Electronic Communications Network or ECNs are execution venues which are providing the infrastructure for matching buyers with sellers. Electronic trading is traditionally used in OTC products and outside of exchanges. An ECN normally functions as an electronic system that disseminates orders entered by market makers to third parties. In doing so, an ECN permits the orders to be executed against in whole or in part. The most common products that are traded on ECNs are stocks and currencies, maki Read this Term) for trading foreign exchange consistently outperformed its peers in the industry over the past couple of years.
The management of Fastmatch will continue to hold 10 percent of the company. In addition to the initial cash payment there is an additional earn-out payment of $10 million and customary minority rights.
As part of the deal, FXCM Group will sell its stake in the ECN for approximately $55.6 million. A portion of the amount will be held in escrow and will be subject to certain future adjustments including a share of a $10 million earnout if certain performance targets of FastMatch are met.
FastMatch Q1 Revenues Totaled $5.8 million
The fastest growing ECN in the industry has posted $5.8 million of revenue in the first quarter of 2017. The number is higher by 48.8 percent when compared to the first quarter of 2016. The company marked $2.4 million of EBITDA (earnings before interest, taxes, depreciation, and amortization) which is 3.6 times higher year-on-year.
Fastmatch is posting a 41.0 percent margin on its operations, with average daily trading volumes for the second quarter of the year coming in at $20.8 billion.
The acquisition will be financed via bank debt and is subject to regulatory approvals. The transaction is expected to close in the third quarter of 2017.
Euronext outlines that the deal is aiming to provide further product and geographic diversification for the company.
Dmitri Galinov
Commenting on the deal, the founder and CEO of FastMatch, Dmitri Galinov, outlined: “We will accelerate our vision of bringing transparency, best-in-class technology and Execution Execution Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Read this Term to FX markets globally. Our superior technology will serve as catalyst to Euronext’s strategic ambitions in growing into the FICC in Europe.”
The Chairman and CEO of the Managing Board of Euronext NV, Stéphane Boujnah, added: “The acquisition of FastMatch breaks new ground for Euronext, through expansion into the FX market which is the world’s largest traded asset class. This will broaden the spectrum of products we provide to capital market users, whilst meaningfully diversifying our revenue and creating long-term value and growth for customers and shareholders.”
“The combination of FastMatch’s in-depth FX expertise, leading technology platform, diverse customer base and entrepreneurial spirit with Euronext’s scale, strength and credibility, will position Euronext as a trustworthy infrastructure provider servicing a market where participants are increasingly looking for transparency, reduced capital costs, cutting-edge trading and long-term clearing solutions,” Boujnah added.
The Chairman of Euronext highlighted that the transaction is in line with the company’s Agility for Growth strategic plan announced in May 2016.