ICAP founder Michael Spencer has sold his spread betting firm City Index for $118 million. The buyer was Bedminster, NJ based GAIN Capital, a U.S. firm that will now be servicing over 230,000 customers with the addition of their newest acquisition. The combined trade volume of GAIN’s transaction will now be sitting at over $3 trillion. This opens up a brand new customer base for GAIN, gaining access to both the trading marketing in the UK, and the online trading market in asia. The UK and Asia online trading markets made up nearly 90% of City Index revenues. Since the spread trading sector has become harder to manage in recent years, anything that can be done to increase trading volume, including merging companies, can be an attractive option.


GAIN CEO Glenn Stevens was quoted as saying that the merger was primarily about growing and scaling the company, as well as helping to advance GAIN’s trading technology. The integration of City Index, started in 1983, will help GAIN expand their overseas market share in the foreign exchange and contracts for difference markets. The company will be seeing a split of about 60/40 in its volume between foreign exchange and other assets such as commodities, equity indexes, etc. respectively.


The City Index deal will be the second major purchase for GAIN in the past 18 months. Global Futures and Forex was acquired by GAIN in late 2013, helping to diversify the company’s revenue away from the US in the forex and derivatives market, where it was earning nearly 90% of its revenue. City Index brought in over $124 million and had a profit of over $10.5 million in EBITDA over the year ending October 1st.