Deals
IG’s $1 Billion Bet on Tastytrade Seen as Pricey; Shares Fall
- U.K. firm to buy Chicago-based platform amid trading boom
- Analysts question ‘punchy’ price and scant earnings guidance
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IG Group Holdings Plc shares fell the most in five months after it agreed to buy Chicago-based online brokerage Tastytrade Inc., with analysts raising concerns over the $1 billion cost of its bet that U.S. retail investors will embrace derivatives.
The deal comprises $300 million in cash and the issuance of 61 million IG shares to Tastytrade shareholders, according to a statement. The combination would add Tastytrade’s more than 105,000 active accounts to IG’s platform, whose core markets include the U.K., European Union, Australia and Singapore.