Online trading services provider GAIN Capital Holdings Inc. has agreed to sell its GTX ECN business to Deutsche Börse AG's foreign exchange unit, 360T, for $100 million.
The deal is subject to customary closing conditions and is expected to close in the second quarter.
Bedminster, N.J.-based GAIN, a global provider of online trading services, initially launched GTX ECN in 2010 as a venue for trading in foreign exchange and precious metals by institutional investors. GTX's more than 150 clients includes banks, nonbank market makers, brokers, and asset managers.
GAIN expects the sale to result in proceeds of approximately $85 million, net of taxes and transaction-related expenses and fees. The deal will provide GAIN with additional financial flexibility to invest in organic growth and M&A opportunities, while providing increased liquidity to accelerate return on capital, CEO Glenn Stevens said in a statement.
Jefferies LLC served as the exclusive financial adviser to GAIN for the deal, and Davis Polk & Wardwell LLP was the legal adviser.
In a separate release, Deutsche Börse said that the GTX ECN business, which reported gross revenues of about $23 million in 2017, would expand its participation in the global foreign exchange market. It added that the transaction is in line with its Roadmap 2020, a plan to accelerate growth through add-on acquisitions.
Deutsche Börse expects the acquisition to be cash accretive in the first year after closing and should meet its return on investment target of over 10% at the latest in the third year after the deal closes.
