Broker dealer KCG Holdings has confirmed it has received an
“unsolicited” offer from rival Virtu Financial to take over the company.
According to a statement from the firm Virtu is offering
between $18.50 and $20 per share, which would value the firm at around $1.3
KCG says its board of directors “is reviewing, in consultation with its
financial and legal advisors, Virtu’s proposal in the context of KCG’s
strategic plans to create shareholder value”.
KCG is itself the result of a previous merger when Knight Capital Group,
struggling to stay afloat after a rogue algo incident, merged with HFT market
making firm Getco in 2013.
Although KCG is a rival market maker it also runs a major agency business
in US equities and it is believed this segment which is most attractive to
Virtu as it seeks to build out a client base. Any deal could also reflect tighter conditions amongst the high frequency market making community, competition within which has pressured spreads even further and seen generally reduced business revenues.