(Alliance News) - TP ICAP PLC on Thursday said it expects revenue for 2020 as a whole to be 1% lower than the year before, as trading volumes remained subdued in the fourth quarter.
Also on Thursday, the FTSE 250 interdealer broker also announced the launch of an underwritten right issue to raise GBP315 million, which will go towards funding the USD575 million acquisition of Liquidnet, first announced in October.
Under the rights issue, which is fully underwritten by HSBC Bank, TP ICAP will offer 225.3 million shares at 140.0 pence each to existing shareholders on the basis of two new shares for every five existing shares held.
The price reflects a 43% discount to TP ICAP's closing price of 246.6 pence on Wednesday. Shares in TP ICAP were down 3.0% at 239.20p on Thursday morning in London.
The rights issue represents 40% of TP ICAP's existing share capital and 29% of its enlarged total.
"This acquisition is a unique opportunity to transform TP ICAP's growth prospects by materially accelerating our stated strategy of electronification, aggregation and diversification. We believe our two businesses are highly complementary and the deal, when completed, will help us to drive growth and shareholder value in the medium to long term," said Chief Executive Officer Nicolas Breteau.
TP ICAP also said that revenue for the first nine months of 2020 was 1% lower on a constant currency basis and 2% on a reported basis.
In addition, due to subdued trading volumes in the fourth quarter, revenue is set to be down 1% from GBP1.83 billion the year before. Most of the decline in revenue stemmed from TP ICAP's Global Broking division.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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TP ICAP (TCAP)