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Screenshot of a breaking news alert e-mail from Q2 2017
LeapRate has learned from sources close to the situation as well as from regulatory filings made late last week that retail Forex brokers IronFX and FXDD are planning to merge. At the same time, the merged company is planning to go public on Nasdaq via a reverse takeover of an existing publicly traded company.
The transaction is expected to value the combined businesses at between $150M – $225M USD.
The transaction has the backing of FXDD’s controlling shareholder, Tradation, the interdealer broking arm of Compagnie Financière Tradition. We also understand that the merged company will have the backing of a major private equity investor which will allow the merged company to carry out its plans to consolidate the retail FX broking sector.
The companies have gone through the initial stages of getting preliminary regulatory approval for the planned transaction. As a first step the companies have already begun a share swap combining 9.9% joint ownership. Keeping it under 10% will allow the companies to first announce the transaction, expected as early as later today, and later finalize all necessary regulatory approvals.
The companies already have options to acquire two other retail Forex brokers, with the backing of the yet unnamed private equity investor.
Both IronFX and FXDD are two of the larger retail Forex brokers running MetaTrader 4. FXDD Global is regulated in Malta (and in the rest of EU via MiFID) by The Malta Financial Services Authority. The broker recently decided to close their U.S. operations and sold their U.S. retail business to FXCM.
IronFX is based in Limassol, Cyprus, regulated by The Cyprus Securities and Exchange Commission. IronFX also has offices in London, UK regulated by the FCA, Johannesburg, South Africa regulated by the FSB, and Sydney, Australia regulated by ASIC. The company also has offices in Madrid, Lisbon, Prague, and Budapest. IronFX has come under attack in the media recently following allegations of mistreatment of clients in China. However, those allegations have never been substantiated.
We will continue to bring you more details as they become available to us.