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FXCM Beefs Up and Extends Credit Facility

FXCM, the US Forex major, announced yesterday a revision to its revolving credit facility which will result in its extension in time and an increase in its amount – changes that are in line with the company's strategic priorities. 
 
The maturity of the credit falls on December 2016, an extension of more than three years, while the size of the commitments reaches $205 million. The broker and its partners have also added the so-called “accordion feature” to the facility – the name is quite indicative of what this feature represents – as the musical instrument, the credit can expand in certain circumstances. And we should stress that the expansion is substantial as the facility may balloon to $250 million.
 
And now that we've seen all of these numbers, let's add some context so that we understand what hides beneath them. For openers, let's note that FXCM is stable in financial terms and that the revolving facility has not been used for quite some time. At the end of the third quarter, the broker said it sat on $638 million in shareholder equity, $421.9 million of own cash and a $155 million credit facility. The latter has been untapped and has signified the stable positioning of FXCM regarding acquisitions. 
 
The main purpose of the increased sum of the credit facility is apparently the M&A strategy of the broker. You may recall that Drew Niv, the chief executive of FXCM, dubbed the deals for Faros Trading and Infinium Capital small ones and promised something bigger in the future. Apparently, the broker is aiming for a big fish on the retail Forex market. 
 
Last, but not least, we should underline, that the boost to the credit facility serves as a piece of evidence of the trust of lenders in FXCM's business strength.
 
 
You can find the official press release below.
 
FXCM Inc. Amended Revolving Credit Facility to Extend Maturity and Increase Commitments
NEW YORK--(BUSINESS WIRE)-- FXCM Inc. (NYSE:FXCM), a leading online provider of foreign exchange, or FX, trading and related services, today announced that FXCM Holdings, LLC has extended the final maturity date of its credit facility by over three years to December 2016 and increased total commitments to $205 million. The credit facility contains an accordion feature whereby it can be expanded to $250 million under certain conditions. The credit facility was further amended to, among other things, provide for continued flexibility regarding financing and investment initiatives.
 
Drew Niv, FXCM Inc.'s Chief Executive Officer, said, "We are pleased to have extended the maturity of our revolving credit facility which will provide us with substantial long-term liquidity and flexibility to execute on our strategic objectives. We are also extremely appreciative of the support and confidence in our company our existing lenders have displayed through their increased commitments."
 
 

About FXCM Inc. 

 
FXCM Inc. (NYSE:FXCM) is a global online provider of foreign exchange, or FX, trading and related services to retail and institutional customers world-wide. 
 
At the heart of FXCM's client offering is No Dealing Desk FX trading. Clients benefit from FXCM's large network of forex liquidity providers enabling FXCM to offer competitive spreads on major currency pairs. Clients have the advantage of mobile trading, one-click order execution and trading from real-time charts. FXCM's U.K. subsidiary, Forex Capital Markets Limited, offers Contract for Difference ("CFD") products with no re-quote trading and allows clients to trade oil, gold, silver and stock indices along with FX on one platform. In addition, FXCM offers educational courses on FX trading and provides free news and market research through DailyFX.com.
TAGS: fxcm  fxcm us  fxcm forex broker  fxcm credit  fxcm m&a  forex retail  forex acquisitions  forex strategy  credit facility  revolving credit facility  corporate debt 

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