TradeStation Acquires IBFX (Interbankfx)

http://www.globenewswire.com/newsroo...ce=Emailvision

Other recap

Losing money since 2009?! Sold for less than half what its VC invested in it 4 years ago?! Ouch... A "fire sale" indeed.

I'm only guessing these guys never figured out how to run a profitable B book, simply astonishing..

from forexmagnates.com website

Couple of months ago I published that Gain Capital is about to acquire Interbank FX after several rounds of discussions with potential investors. In that round Gain remained as the last bidder. This deal however failed at the last moment for reasons not known to me – but not hard to guess that it was a disagreement over final price.


IBFX didn’t give up on trying to be sold and today finally succeeded – TradeStation (which itself was acquired by Japanese Monex Group few months back) just announced that it reached an acquisition agreement with IBFX.


IBFX is bought for mere $17 million – which is less than half Spectrum Equity invested in it back in July 2007. According to industry sources Spectrum invested $40 million in exchange for 25% of IBFX, however its stake almost doubled as IBFX failed to meet its income targets. Eventually at the time of this deal Todd Crossland held 59% and Spectrum 40%.


IBFX average volume is $1.2 billion a day, slightly lower than the Forex Magnates volumes survey estimate of $1.4 billion as published in the latest Forex Magnates Quarterly Industry Report. After the acquisition Monex Group’s forex volume is expected to be about $3.1 billion a day, with TradeStation accounting for $0.4 billion out of this figure (Forex Magnates estimate was $0.5 billion).


IBFX had 27,000 funded accounts and was losing money consistently since the end of 2009. It seems that this was a fire sale due to both pressure from Spectrum and IBFX’s inability to get back to profitability.

I'm really curious about how they were bleeding cash... IBFX spreads weren't the worst but by far were not as tight as others, and they had a very similar model as FXCM without the overhead of maintaining a propitiatory platform.. what am I missing?

kind of make you wonder

They were trying a lot of expansion, Korea, Singapore, China, etc. That can eat up profits and put you in the losing column very quickly.

Maybe too much money spend on marketing....

they only sold for 17mill, for a broker to have 27k clients, there is more to the story.

Did they find in necessary to open offices in other countries to attract non US clients, do to US regulations enacted a couple years ago?

27,000 funded accounts... does not sound like that much to me considering how much you hear of them. You have to figure half of those accounts are probably 1k or less....

not that much money ... jmo..

I withdrew most of my money from my account with them a couple of years ago due to ever increasing spreads, just left in enough to keep it open.

Perhaps under Trade Station the trading will be better. If so trading IBFX under Trade Station may a solution to to Amerca's anti hedging rule put in place. I understand that position size ends up the same, problem is you can not use stop orders as before. Personally I do not want to trust a EA to manage any serious size, I like stop entry and exit orders to reduce the execution risks.


Best regards

Dale

As IBFX is part of TradeStation now, do you guys enjoy the same spread like TradeStation offers?

http://www.tradestation.com/pricing/forex-pricing
http://www.tradestation.com/en/prici...ker-comparison

cheers

I just received the following email from IBFX. There's also a link on IBFX.com:

http://www.ibfx.com/Platform/TradeStation
---------
"Dear Valued Customer,

I'd like to update you on some of the exciting things that are happening at IBFX, and how they may impact your trading experience.

As you're probably aware, TradeStation Group acquired the IBFX Group in November, 2011. This was preceded by the acquisition of TradeStation by the Monex Group in June, 2011.

The goal of these acquisitions is to help realize Monex Group's vision of becoming a truly global financial services firm. This includes consolidating its multiple forex operations into one group, providing better trading resources and products for our traders. Going forward, IBFX will be the global forex brand for the Monex Group.

We're happy to announce today that we are now able to offer the award winning TradeStation platform to IBFX customers. In addition, we are launching TradeStation ifx, offering immense liquidity and great spreads for our institutional customers.

Monex Group has a market capitalization of over $500 million USD, representing significant financial stability. With backing from Monex, IBFX is more capable than ever before to focus on what matters most: your trades.

Thank you again for your business, Gary Weiss
President, IBFX"

It should also make IBFX one of the safest brokers to trade at the moment, since Tradestattion's auditors checked the books and bank accounts really well before closing the deal. Something that the regulators would not do even if their life depended on it.