Intercapital reverses into Exco to create huge Euro broker
Thursday 01 October 1998
The deal will create one of the largest derivatives brokers in Europe, with a market value of pounds 91m and more than 1450 staff. Most of the job losses will hit the combined group's operations in London, where more than 710 staff are employed.
Michael Spencer, chief executive of Intercapital, will become chairman and chief executive of the enlarged group, to be called Intercapital plc. Five out of the other six seats on the board will be filled by Exco directors.
Mr Spencer said the deal was driven by pressure for consolidation within the money broking sector in the run-up to European monetary union. Where forty brokers existed two years ago, there are 20 now.
The advent of European monetary union has increased pressure on money brokers to consolidate as the need for specialist brokers, dealing in each of the member countries' currencies, disappears.
Emu was also likely to boost demand for interest rate swaps, one of Intercapital's strengths, Mr Spencer said. "Specialists will disappear and people will want one firm to deal with."
The deal will be financed by an offer to Intercapital of 231 million new shares in Exco, the proceeds of which will be used to buy Intercapital. Mr Spencer and his family, who founded Intercapital in 1986, will retain their 42 per cent stake.
The takeover brings to an end a difficult period for Exco, a former subsidiary of the British and Commonwealth group. The company has been battered by rising wage demands and falling commissions for derivatives trades.
In the six months to June, Exco saw its turnover plunge more than 20 per cent to pounds 80.5m. The company recorded a loss before tax of pounds 0.9m against a profit of pounds 5.4m in the first half of 1997.
Mr Spencer said most of the job losses would come from the London operations of the combined group. He added: "The overwhelming majority of the pain that Exco had to go through is already done. I would like to think we are buying at the bottom."
- 1 Crystal meth addict 'gouged out his eyes and ate them' while high on drug, Australian MP claims
- 2 Saudi Arabia 'seeking to head United Nations Human Rights Council'
- 3 Group of students refused entry to Leicester nightclub 'because they are black'
- 4 Irish people are travelling home from all over the world so they can vote to legalise gay marriage
- 5 Arsenal fan asks the Queen for tickets to the FA Cup final - gets a reply from Buckingham Palace
Ireland's same-sex marriage vote: Dublin in party mood ahead of historic poll result
Saudi Arabia 'seeking to head United Nations Human Rights Council'
The ten most unequal developed countries in the world
Toddler throws a tantrum at the White House – in front of Barack Obama
Irish people are travelling home from all over the world so they can vote to legalise gay marriage
As a white man, I'm surprised more women aren't tweeting the hashtag #KillAllWhiteMen
Scotland may have to leave the EU even if it votes to stay in, David Cameron confirms
Report finds that Britain's wages are the most unequal in Europe
Almost a third of school pupils believe 'Muslims are taking over our country', study claims
The day that Britain resigned as a global power
Gay marriage 'Bert and Ernie' cake bakery found guilty of discrimination in Northern Ireland
iJobs Money & Business
£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...
£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...
£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...
£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...