Forex Capital Markets (FXCM), the leading forex broker in the US, seems to plan to raise $125 million through the issues of securities. The broker has filed a preliminary prospectus with the US Securities and Exchange Commission (SEC), according to which the broker intends to issues class A common stock, preferred stock, debt securities, depositary shares, purchase contracts, warrants, or units, or rather a mixture of those.
FXCM intends to use the proceeds it plans to raise to hike its capital and refinance its liabilities, as well as to repurchase certain outstanding securities.
The broker’s prospectus, however, is not very informative and precise. Preliminary prospectuses are required by the SEC when a company plans to issue securities and aim to inform investors of a company’s intentions, rather than make an offer. According to the document, FXCM will not issue the securities at once. It “may offer from time to time up to an aggregate of $125,000,000 of any combination” of the above-listed securities. In what combination these securities would be offered is yet to become clear.
Since it is not certain in when the broker will issue for purchase securities, their price will differ depending on factors as the current market prices at the time of sale.
What distribution channels FXCM will use was another thing that the broker did not specify. It may or may not use mediators and it may or may not offer securities directly to buyers. It may choose one or many of the following:
- on the New York Stock Exchange (including through at the market offerings)
- in the over-the-counter market
- in privately negotiated transactions
- through broker/dealers, who may act as agents or principals
- through one or more underwriters on a firm commitment or best-efforts basis
- in a block trade in which a broker/dealer will attempt to sell a block of securities as agent but may position and resell a portion of the block as principle to facilitate the transaction
- through put or call option transactions relating to the securities
- directly to one or more purchasers
- through agents
FXCM noted that even if the securities get registered, this may not result in their being offered or sold.
FXCM (NYSE:FXCM) is one of the biggest providers of online forex and CFD trading, spread betting and related services worldwide, servicing institutional and retail clients alike. Recently, we reported that the broker continues to lead the US retail forex market both by trading volume and client deposits.
The company has units registered and regulated with the relevant authorities in the US, the UK, Australia, and France.