Friday, March 11, 2016 7:15:55 AM
http://www.wsj.com/articles/fxcm-reaches-preliminary-pact-to-extend-credit-accord-swings-to-loss-1457650497
Accord could give FXCM more time to raise funds to repay its debt by shedding noncore assets
The Wall Street Journal, By Tess Stynes
March 10, 2016 5:54 p.m. ET
FXCM Inc. reached a preliminary accord to extend its credit agreement with Leucadia National Corp. by a year to January 2018, potentially giving FXCM more time to raise funds to repay its debt by shedding noncore assets.
The online foreign-exchange trader also reported that it swung to a fourth-quarter loss amid weaker trading volume and revenue.
FXCM’s shares, which have dropped 30% in the past 12 months, fell 22% to $11.40 in recent after-hours trading.
FXCM lost millions from retail clients who were caught on the wrong side of bets on the Swiss franc in January 2015. To continue operations, FXCM secured a $300 million loan from Jefferies Group LLC parent Leucadia National Corp. and has been paying down the loan.
As part of that rescue package, FXCM formed subsidiary FXCM Newco and gave it all equity interests owned by the holding company.
FXCM said Thursday that unit would be renamed FXCM Group LLC and Leucadia would own a 49.9% membership interest. The partnership would be governed by an eight-member board, including three members appointed by Leucadia, three directors appointed by FXCM, two independent directors and one each to be nominated by the two firms.
After January 2018, each firm would have a right to unwind the partnership, possibly resulting in a sale of FXCM Group. A long-term incentive program with a five-year vesting period would be put in place for FXCM senior management.
It is also anticipated that FXCM would change its name and stock ticker symbol, which would be determined at a later date.
For the three-month period ended Dec. 31, FXCM reported a loss of $105 million, or $19.29 a share, compared with a year-earlier profit of $15.8 million, or $3.56 a share. The latest period included a noncash charge of $99.9 million related to the company’s credit agreement with Leucadia. Revenue dropped 34% to $67 million, mostly on a 30% decline in trading revenue.
Total trading volume dropped 16%, and average daily trades declined 5%.
Write to Tess Stynes at tess.stynes@wsj.com
VHAI - Vocodia Partners with Leading Political Super PACs to Revolutionize Fundraising Efforts • VHAI • Sep 19, 2024 11:48 AM
Dear Cashmere Group Holding Co. AKA Swifty Global Signs Binding Letter of Intent to be Acquired by Signing Day Sports • DRCR • Sep 19, 2024 10:26 AM
HealthLynked Launches Virtual Urgent Care Through Partnership with Lyric Health. • HLYK • Sep 19, 2024 8:00 AM
Element79 Gold Corp. Appoints Kevin Arias as Advisor to the Board of Directors, Strengthening Strategic Leadership • ELMGF • Sep 18, 2024 10:29 AM
Mawson Finland Limited Further Expands the Known Mineralized Zones at Rajapalot: Palokas step-out drills 7 metres @ 9.1 g/t gold & 706 ppm cobalt • MFL • Sep 17, 2024 9:02 AM
PickleJar Announces Integration With OptCulture to Deliver Holistic Fan Experiences at Venue Point of Sale • PKLE • Sep 17, 2024 8:00 AM