Virtu Is Said to Explore Sale of Fixed Income Unit BondPointBy and
BondPoint is said to draw ICE, Tradeweb, MarketAxess interest
Virtu acquired BondPoint in $1.4 billion purchase of KCG
Virtu Financial Inc. is exploring a sale of debt-trading services provider BondPoint, according to people familiar with the matter, as the high-speed trading firm exits certain businesses linked to its takeover of rival KCG Holdings Inc.
The New York-based firm is working with Jefferies Group to seek buyers for BondPoint, which could fetch about $300 million in a sale, said the people, who asked not to be identified because the matter isn’t public.
The unit is expected to draw interest from rival trading-technology and data providers such as MarketAxess Holdings Inc., Tradeweb and Intercontinental Exchange Inc., the people said. Potential suitors have begun signaling their interest in the business to Virtu, which expects to begin soliciting offers after Labor Day, they said.
Representatives for Virtu, Jefferies, MarketAxess and Tradeweb declined to comment. A representative for ICE didn’t immediately return phone calls requesting comment.
Analysts and investors have speculated for months that Virtu would unload BondPoint, a division of KCG that helps traders buy and sell various corporate and government debt securities. Virtu executives said in April it would sell off non-core businesses as part of its $1.4 billion purchase of KCG, to help cut capital costs by $440 million. The deal closed in July.
“It’s a terrific asset,” Virtu Chief Executive Officer Doug Cifu said of BondPoint on a call to discuss the KCG deal on April 20. “I think it’s a market leader in what it does. I think it’s got a lot of potential.”
Bloomberg News parent Bloomberg LP also provides bond-trading services.