DislikedWe anticipate that with the proceeds from the sale of some non-core assets and continued earnings we can meet both near and long-term obligations of our financing, while preserving the strength of our franchise. It's widely known and understood that FXCM's core business has always been retail FX; It is the majority of our revenue. Earlier this month, we announced certain key operating metrics for January 2015 as we do every month as a publicly-traded company. The data show that it was our second best month ever in terms of retail volume... We believe that in the near term we can pay down a majority of the loan.Ignored
Dislikedwith interest rates so low, why would they take such a burdensome deal? Why no loan from a major bank? Why no other offers? Makes you think the real situation isn't very promising despite the positive "spin" FXCM is putting on it's recent trader activity.Ignored
DislikedMy take on the deal is that it wasn't a solvency issue (although if the losses had been bigger, it would have been). Rather, this was a liquidity issue - FXCM had enough assets on the balance sheet, but needed cash for the regulators, and regulators don't take assets, they only take cash, and FXCM couldn't raise that cash over a weekend by selling assets. So the LUK loan was structured in a way to give FXCM the short-term cash while allowing them time to sell the assets to pay back the loan, and it obviously seems like a great deal for LUKIgnored
Just as a follow up on this, here's an article in today's Wall Street Journal where Leucadia confirms that they have begun to receive payments from us and expect to recover more than a quarter of their investment within three months of the deal's closing: Leucadia Begins Recovering FXCM Investment - WSJ