Prebon's electronic trading platform goes public in £400m reverse takeover

Prebon Yamane, one of the world's top four over-the-counter money brokers, yesterday said it had agreed to reverse its electronic trading platform into the London-listed cash shell Firth Holdings. The deal takes a large part of the privately owned Prebon public, valued at between £400m and £600m.

Prebon Yamane, one of the world's top four over-the-counter money brokers, yesterday said it had agreed to reverse its electronic trading platform into the London-listed cash shell Firth Holdings. The deal takes a large part of the privately owned Prebon public, valued at between £400m and £600m.

The demerger of the money broker, followed by the reverse takeover transaction, will see Firth renamed as Kinetech. The takeover will be conducted on a share-for-share basis and includes a £80m placing of new shares which are on offer to existing Firth shareholders and new institutional investors.

The reverse takeover is set for completion in October subject to agreement by Firth shareholders. Firth said its two major shareholders, Clydesdale Bank and Brewin Nominees, who together control 30.4 per cent of the company, had indicated support for the deal.

Prebon Yamane operates from 30 financial centres worldwide, and transacts $55,000bn (£38,000bn) of business annually. The terms of the deal mean Kinetech will own and operate the proprietory electronic trading platforms, IT operations and resources of Prebon, and willmanage its financial information business. Patrick Keenan, who has been on the Prebon board since 1991, will be chief executive of the new company.

Firth's chairman, Sir Alan Thomas, said half the proceeds of the placing would go to repay Kinetech's inter-company debt and the rest used for expansion.

"There is enormous territory to be captured but we need to move quickly," said Mr Keenan.

The electronic platform enables clients to migrate from voice-brokered trading to wholly electronic trading.