The investment will be made in several tranches, with the first tranche (which we believe is in the $10 million+ range) to be made immediately.
We understand from sources close to the negotiations that the investors will initially receive one seat on IronFX’s board of directors, and will receive more board seats as further tranches of the investment are made.
The plan apparently is to use IronFX as a platform for acquisitions and consolidation in the FX industry. As LeapRate has written numerous times in recent months, smaller players in FX industry are finder it tougher to make money in the face of tougher regulations and increased competition, providing good opportunities for deeper pocketed, larger brokers to pick off competitors.
We also understand that the new investment does not really affect one way or another IronFX’s long-delayed merger with FXDD, Forexware, and Nukkleus Inc (OTCMKTS:NUKK), a company controlled by longtime FX industry executive Emil Assentato. Mr. Assentato has an effective 80% interest in both FXDD and Forexware via Currency Mountain Holdings which he controls (Tradition et Cie owns the other 20% in each), and he fully owned Nukkleus heading into the planned transaction. That deal may or may not go ahead, but if it does it will be with a much-strengthened IronFX.
We would also note that over the past year or so there has been a lot of “fake news” circulating about IronFX, with one or two lightly-read FX blogs in particular seeming to have a particular vendetta against IronFX and its controlling shareholder Markos Kashiouris. Titles of articles covering IronFX included wording such as “fraudulent”, “corruption”, “ham-fisted”… We would also note that a quick web search shows that many if not all of those fake-news articles have since been taken down by the blog(s) in question, without any announcement, explanation or apology having been made.
Commenting on the investment, IronFX CEO Markos Kashiouris stated:
Over the past eight years IronFX has established itself as a global retail FX business and brand focusing on quality of service, wide and sophisticated product range, impeccable execution and localised presence. We are now ready to expand our capital base to ensure the next phase of the Company’s growth.
Our ability to attract sizeable investment and the quality and reputation of our new international partners demonstrates the significant strides made by the Company over the past years, as well as its current market position and future outlook. It also signifies an important foreign direct investment and a vote of confidence in the Cyprus financial sector where the large majority of the Company’s operations are located. This reflects the fact that Cyprus combines many favourable features that make it a unique investment destination since, among others, investment firms are subject to a robust fair and proactive supervisory environment.
Full story: https://www.leaprate.com/forex/brokers/fx-broker-ironfx-raises-100-million-middle-east-investors/