21st Jun 2016 17:46
LONDON (Alliance News) - Interdealer brokers ICAP PLC and Tullett Prebon PLC have agreed that ICAP will no longer hold a 19.9% interest TP ICAP PLC as previously announced, Tullett said on Tuesday, as the pair offered to sell ICAP's London-based oil desks, in a bid to address the UK Competition & Markets Authority's competition concerns.
In November, Tullett Prebon and ICAP reached an agreement for Tullett to buy ICAP's voice broking and information business, which Tullett said it would rename TP ICAP.
Previously, under the terms of the offer Tullett said it would issue shares to ICAP shareholders and to ICAP in consideration for the acquisition. The new shares would represent a 56% stake in Tullett's enlarged share capital, Tullett had said at the time, and ICAP shareholders would own 36% of the company, while ICAP itself would own 19.9%.
However, on Tuesday, Tullett said ICAP no longer will hold a 19.9% interest in the business and the shares will be issued directly to ICAP shareholders, meaning shareholders will hold the entire 56% stake.
In a statement, ICAP said, upon completion, it will "begin to trade as NEX Group PLC, a focused electronic and post trade group with a leading portfolio of financial market infrastructure businesses and products".
This came after a statement from the CMA in which it said it was considering the offer, for the pair to sell the London oil desks, instead of launching an in-depth investigation into the deal.
The CMA earlier this month said it was considering an in-depth investigation into the deal, and raised concerns that the deal would give rise to the prospect of a lessening of competition for the voice-hybrid broking of oil products.
In a statement on Tuesday, the CMA said it will consider in detail the undertakings offered by Tullett and ICAP, for the pair to sell ICAP's London-based oil desks, responsible for providing broking services to customers based in Europe, Middle East, & Africa, to an up-front purchaser approved by the regulator.
The CMA said it has until August 16 to make its decision, with the possibility of extending this timeframe if "it considers that there are special reasons for doing so".
Shares in ICAP closed up 3.8% at 430.10 pence on Tuesday, whilst shares in Tullett closed up 1.0% at 321.00p.
By Hannah Boland; [email protected]; @Hannaheboland
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