The world’s largest futures exchange, CME Group, has agreed to buy Michael Spencer’s Nex Group in a £3.9bn deal that will net the former Tory party treasurer £670m.
CME also picked London as its European headquarters, giving a much-needed boost to the UK government during its Brexit negotiations. The move comes after CME’s decision last year to shut its loss-making London bourse and clearing house.
“CME’s decision to choose London as its European headquarters is also a signal of tremendous support for Britain’s financial services sector,” Spencer said.
Spencer, the Nex chief executive, owns a 17.6% stake in the financial broker he founded in 1986. It changed its name from Icap at the end of 2016 and is one of the world’s biggest money-broking firms.
He will join the CME board as a special adviser and will stay on for a minimum of two years to oversee the integration of the two businesses.
It is the biggest overseas acquisition made by the Chicago-based CME, and its largest in a decade.
CME said it would pay £10 a share for Nex –[tooltip id=”4500c2f113202943ff1ae30d00c9d4ac”] [/tooltip]£5 in cash and 0.00444 new CME shares per Nex share. Nex said it would recommend the deal to shareholders.
Investors will also receive a final dividend for the year to March 2018, which will not exceed 7.65p a share.
The takeover, which still has to be approved by Nex shareholders, will lead to 750 job losses over the next three years in the combined business, or 16% of the total workforce. It is not clear where they will occur.
Nex has 1,900 employees globally, including 634 in London and 42 in Bristol. CME employs 2,800 people worldwide,[tooltip id=”4500c2f113202943ff1ae30d00c9d4ac”] [/tooltip]400 of them in London.
Last year Nex agreed to pay back donations of £25,000 made to Conservative general election candidates after a shareholder revolt.
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