Commodities Dealer Marex Eyes £500M London IPO

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Marex is planning to float its shares at the London Stock Exchange (LSE). However, in-depth details about the IPO have not been provided.

Marex is one of the leading commodities brokers in the world owned privately. After the announcement reported by Reuters on May 14, the firm is considering a free float of around 25% of the company’s shares.

According to a reliable source inside the company, Marex will start its listing towards the end of June. The company’s valuation at the time of listing is expected to be around 500 million pounds, equivalent to around $703 million.

To help with the deal, the company has partnered with JPMorgan and Goldman Sachs.

Increased demand for commodities

The development comes at a time when the demand for commodities markets is at an all-time high. The private equity owners of Marex have been trying to sell the company for years, but their attempts have been unsuccessful.

In the 2020 financial year, Marex was among the firms in the London Metal Exchange to report a 17.7% increase in net revenues. The revenues for that financial year came in at $414.7 million, while the adjusted operating profits before tax increase by 15.2% to reach $61.5 million.

Boost growth strategy

Marex is a wholly-owned company by JRJ Group, a private equity firm established by two investment bankers. It is also co-owned by BXR Group and Trilantic Capital, who bought a majority stake in the company back in 2010.

In recent years, the London-based broker has been looking into active ways of expanding their business processes through various acquisitions. This would form the perfect avenue for the firm to enhance its strategy of gaining returns as a public company.

After the firm’s failed exit strategy, the owners have decided to exploit the boom in the brokerage market to change their strategy and instead take the company public. This will enable the firm to gain capital by listing its shares at the LSE. Marexis one of the only five exchanges that operate at the London Metal Exchange, giving it a competitive edge.

The CEO of Marex, Ian Lowitt, spoke of this development, stating, “The attractiveness and resilience of our business model is demonstrated by our latest set of results which showcase continued strong performance despite the obvious macro headwinds. I am excited about the next stage of our development and the growth opportunities ahead. We look forward to generating continued value for all our stakeholders.”

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