J.C. Flowers buys 30% stake in LMAX at $1 billion valuation


Institutional FX and crypto execution venue LMAX Group has announced that it has signed a definitive agreement to sell a 30% stake in the company to J.C. Flowers & Co. LLC, a leading private investment firm dedicated to investing globally in the financial services industry, for cash consideration of $300 million valuing LMAX Group at $1 billion.

This is a secondary share sale by LMAX Group employees, with the company not receiving any cash from the transaction. The transaction remains subject to regulatory approval.

LMAX reported Gross Profit of $60.5 million and EBITDA of $39.2 million for the first six months of 2021, with both figures significantly increased from last year.

LMAX Group and J.C. Flowers issued a joint statement saying that they will partner to accelerate the Company’s next phase of growth and innovation, and together see potential for greater penetration in the FX and crypto currency markets globally, particularly in the U.S. and Asia. Following the transaction, David Mercer, CEO, will continue to lead the Company having retained a substantial stake alongside his management team and J.C. Flowers.

Headquartered in London, LMAX Group operates five exchanges globally, matching engine infrastructure in London, New York and Tokyo with clients in over 100 countries. Over the last decade the Group has built a leading institutional FX exchange and in 2018 launched LMAX Digital which has become the leading institutional spot crypto currency exchange, serving over 500 institutional clients and is the second largest bitcoin exchange globally.

Commenting on the transaction, David Mercer, CEO, LMAX Group, said:

David-Mercer-LMAX“This is a significant milestone in the evolution of LMAX Group that vindicates our industry-leading business model and the role we have to play in the foreign exchange and crypto currency markets of the future. Not only have we identified a like-minded partner in J.C. Flowers who understands global capital markets and brings valuable connectivity to strengthen LMAX Group’s presence in North America and Asia, but one that shares our vision of building the Company into the pre-eminent global FX and crypto currency exchange. I’m excited about the many opportunities that lie ahead for LMAX Group and my fantastic group of colleagues.”

Chris Flowers, Managing Director and CEO, J.C. Flowers & Co., said:

“LMAX Group is an exciting and well-respected company with a leading position in a market with great potential, making it a highly compelling opportunity for our Firm. The LMAX Group exchange infrastructure offers efficiency and transparency, both of which are in high demand by the growing numbers of institutional participants in foreign exchange and crypto currency trading. David and his management team have driven considerable international growth in recent years, and we look forward to supporting them as they continue to expand their support of the world’s top institutional market actors.”

Morgan Stanley & Co. International PLC is serving as financial advisor and Squire Patton Boggs (UK) LLP is acting as legal counsel to LMAX Group. Jefferies LLC is serving as financial advisor and Sullivan & Cromwell LLP is acting as legal counsel to J.C. Flowers & Co.

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