LONDON & CHICAGO--(BUSINESS WIRE)--IG Group Holdings Plc (“IG”), the global online trading platform and tastytrade, Inc. (“tastytrade”), the fast-growing online financial network advocating for and empowering the individual investor, announced today their intention to join forces in a landmark deal. IG is offering tastytrade a total purchase price of $1 billion which excludes tastytrade’s cash. The management teams for IG and tastytrade will remain the same.
Both IG and tastytrade have a shared passion for market disruption, innovation, and growth. They are committed to empowering self-directed traders to unlock opportunities in the financial markets and engaging their customers with innovative educational content – a true differentiator in the market. In addition, in four short years, tastytrade has built one of the top-rated brokerage businesses1 for online trading by active traders in options and futures. This deal significantly scales IG’s footprint into the U.S. derivatives market and further diversifies its product offering, while providing a global platform for tastytrade’s international ambitions.
“I am thrilled to welcome tastytrade to the IG Group family. This acquisition will materially expand and scale our business in the U.S. and see us further diversify into the exciting high growth market of U.S. retail options and futures, a market which is adjacent to IG’s core retail trading skill set. The U.S. market has more than 1.5 million retail traders2 and is the largest derivatives market in the world,” said June Felix, Chief Executive Officer of IG Group.
“tastytrade has grown impressively and proven itself to be an innovative market disrupter passionately committed to delivering for their clients. The financial and strategic rationale underpinning this deal are compelling. I am confident that with our shared client centric ethos, passion for innovation and growth – IG and tastytrade will prove a winning combination.”
“Early on we knew tastytrade was a very special company. While our long-term goal has always been to go global, we waited almost 10 years until we found the right partner and perfect match. Together we will focus on empowering the self-directed investor and change the way people perceive and engage with financial markets. Get ready world!” said Tom Sosnoff, Founder and co-CEO of tastytrade.
“We created tastytrade with a vision to challenge self-directed investors to think and trade strategically. We built an ecosystem to empower them. No other firm has built a retail trader ecosystem in quite the same way: delivering authentic, fun and actionable research-based content through our uniquely developed financial media network; to our two revolutionary brokerage firms with intuitive front-end technology and built on high frequency middleware; to a retail-focused futures exchange,” said Kristi Ross, co-Founder and co-CEO of tastytrade. “IG shares our mission, and similarly has a deep-rooted track record of innovation, leadership in the financial markets and a robust and scalable infrastructure. Most importantly, we share a customer-centric philosophy. We are excited to work with IG to make derivatives trading more accessible for retail investors around the world.”
The tastytrade platform is expected to remain the same with operations to continue seamlessly. Completion of the acquisition is anticipated to occur in the first quarter of IG’s financial year ending May 31, 2022, subject to satisfaction of customary conditions and regulatory approvals.
The transaction will position IG to drive additional long-term earnings growth through the acquisition of a fast-growing business operating at attractive profit margins and delivering strong cash conversion. The transaction is expected to be low single digit accretive to IG’s adjusted earnings per share3 in the first full year post completion.
Jefferies International Ltd. and Fenchurch Capital Partners LLP are acting as Lead Financial Advisors to IG.
For more information visit IG’s Regulatory News Service announcement at https://www.londonstockexchange.com/news-article/IGG/proposed-acquisition-of-tastytrade-inc/14834889.
IG empowers informed, decisive, adventurous people to access opportunities in over 17,000 financial markets. With a strong focus on innovation and technology, the Company puts client needs at the heart of everything it does.
IG’s vision is to provide the world’s best trading experience. Established in 1974 as one of the world’s first providers of financial derivatives to retail traders, it continued leading the way by launching the world’s first online and iPhone trading services.
IG is an award-winning, multi-product trading company which allows retail, professional and institutional clients to trade 24 hours a day, 7 days a week4. IG is the world’s No.1 provider of CFDs5 and a global leader in forex derivatives. It provides leveraged services with the option of limited-risk guarantees and offers an execution-only stock trading service in the UK and Australia. IG has a range of affordable, fully managed investment portfolios, which provide a comprehensive offering to investors and active traders.
IG is a member of the FTSE 250, with offices across Europe, including a Swiss bank, Africa, Asia-Pacific, the Middle East and North America. IG Group Holdings plc holds a long-term investment grade credit rating of BBB- with a stable outlook from Fitch Ratings.
About tastytrade, Inc.
Based in Chicago, IL and founded in 2011, tastytrade is a unique and fast-growing platform advocating for and empowering the individual investor. A disruptive force in the U.S. derivatives market, tastytrade provides differentiated financial content, retail trader education and brokerage services. The company was founded and is led by the entrepreneurial management team who previously created the highly successful options trading platform, thinkorswim, acquired by TD Ameritrade in 2009.
tastytrade is one of the most-watched online financial networks, engaging investors and traders across 190 countries with 8 hours of daily, live, cost-free and commercial free programming with over 100 million hours viewed and programming 7 days a week. tastytrade offers over 100 original segments for new and seasoned veteran traders. tastytrade’s data driven research-based content teaches a logical, mechanical approach to investing and identifying opportunities based on probability and volatility. Investors are continually challenged with financial math, humor and new market perspectives.
tastytrade is the parent company to tastyworks, a brokerage firm creating and leading a financial revolution for the do-it-yourself investor and dough, a mobile-first brokerage firm radically challenging the status quo and changing wealth creation and the Quiet Foundation, a data science-driven, investment advisory service launched in 2018. tastytrade is also an ‘incubator’ of other fintech companies, including, The Small Exchange, a futures exchange platform focused on retail traders launched in 2020, and investor in Zero Hash, a crypto-currency infrastructure provider.
1 Source: tastyworks was ranked the second best online broker for active traders by Barron’s in its “Best Online Brokers for 2020” report.
2 Latest Investment Trends market reports and internal estimates.
3 EPS is adjusted to add back amortisation of acquired intangibles (non-cash), utilisation of transaction-related DTA (non-cash), compensation expense related to vesting of tastytrade employee retention package, and one-time transaction costs.
4 Excluding 10pm Friday (GMT) to 8am Saturday (GMT)
5 Based on revenue excluding FX (from published financial statements, June 2020