FxPro Group May Hold London IPO as Soon as Next Year, CEO Says 

FxPro Group Ltd. may hold an initial public offering in the U.K. as soon as next year as the online currency broker considers making acquisitions and expanding into new markets.

The privately held company, which in 2010 canceled an earlier IPO attempt, plans to open an office in Dubai to tap wealthy Asian, Middle East and Persian Gulf state clients, Chief Executive Officer Charalambos Psimolophitis said in a phone interview Monday. A stock sale is dependent on market conditions and board approval, he said.

“We’ve had very preliminary discussions with a number of investment banks, but no decision has been taken,” Psimolophitis said. “We’ve had ongoing discussions and that didn’t start today, it has been going on for last two years. It’s something that might happen,” he said.

Currency trading by individuals expanded in the mid-1990s, with international banks offering products such as dbFX, which was operated by Deutsche Bank AG. The wider availability of the Internet toward the end of the decade spawned a generation of smaller firms acting as middlemen with banks for consumer clients. Some brokers are now seeking to merge to cut costs as regulatory burdens increase.

“Being a listed company, it gives much more tools and firepower to acquire smaller brokers,” Psimolophitis said. “I see consolidation in the industry.”

Franc Hit

The company ranked 10th in the third quarter among retail currency brokers outside Japan, according to data on volumes compiled by Finance Magnates, a research company.

FxPro Group has operations in the U.K., Cyprus and Monaco, with about 220 staff. In October 2010, it postponed plans to sell stock, joining more than 100 companies worldwide that were forced to cancel IPOs that year amid market swings.

Retail currency brokers, including FxPro Group, this year took a hit after some clients lost money when Switzerland abandoned the Swiss-franc cap in January, prompting the currency to soar.

The impact caused London-based Alpari (UK) Ltd. to cease trading. FXCM Inc., the largest U.S. currency brokerage for retail clients, received a $300 million cash infusion from Leucadia National Corp., while IG Group Holdings Plc, Swissquote Group Holdings SA, CMC Markets Plc and OANDA all said they suffered losses on franc trades.

FxPro Group said at the time that client commitments remained unchanged and negative balances hadn’t affected customer funds. The losses were borne by the company’s capital.

The Bank for International Settlements estimates retail trading accounts for 3.5 percent of the $5.3 trillion-a-day foreign-exchange market.

Source: Bloomberg – FxPro Group May Hold London IPO as Soon as Next Year, CEO Says

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