Do not invest more money than you can afford to lose.
US forex giant Forex Capital Markets (FXCM) intends to issue additional securities worth combined $125 million, according to a preliminary prospectus filed with the US Securities and Exchange Commission (SEC) on Tuesday. The amount could be raised with the issue of a combination of equity and debt in one or more offerings.
The broker intends to use the proceeds it would raise to increase its working capital, to reduce or refinance outstanding debt, and to repurchase certain outstanding securities.
According to the filing, the broker considers to issues Class A common stock, preferred stock, debt securities, depositary shares, purchase contracts, warrants, or units. Since the securities will possible be offered in tranches at different times, their price will vary depending on the market prices. The securities are planned to be issued in the over-the-counter (OTC) market and/or on the New York Stock Exchange (NYSE) (including through at the market offerings).
“This prospectus is part of a registration statement that we filed with the Securities and Exchange Commission using a “shelf” registration process. Under the shelf registration process, we may offer from time to time up to an aggregate of $125,000,000 of any combination of Class A common stock, preferred stock, debt securities, depositary shares, purchase contracts, warrants or units in one or more offerings,” the filing read.
FXCM already has Class A common stocks listed on the NYSE under the symbol FXCM.
The preliminary prospectus does not bind the broker to any specific actions. It is required by the SEC prior to initiating the offering of securities. The document includes explanation of the type of different securities that the company may issue. It is rather an initial step towards achieving a goal of issuing the above-said securities, a first draft of a sort. Prior to launching its offer, the company needs to get a registration statement approved by the SEC.
Only time will tell when or whether FXCM will go through with its plan. Even if it does, it is not clear how much time it will take it to complete its plan to issued all planned securities. In the notice, the broker said it “may from time to time offer and sell some or all of the securities covered by this prospectus”.
FXCM is a broker of forex, contracts for difference (CFDs), and spread betting. It serves both retail and wholesale clients. The brokerage is a registered futures commission merchant (FCM) and a retail foreign exchange dealer (RFED) with the US Commodity Futures Trading Commission (CFTC). It has units registered and regulated with the relevant authorities in the US, the UK, Australia, and France.
It is the largest forex broker in the US in terms of retail client deposits, active accounts and monthly trading volume.
Source: SEC
