IG Group Holdings plc
LEI No: 2138003A5Q1M7ANOUD76
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN, INTO, OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF THAT JURISDICTION
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
FOR IMMEDIATE RELEASE
IG GROUP HOLDINGS PLC
Proposed Acquisition of tastytrade, Inc.
21 January 2021
The Board of IG Group Holdings plc ("IG" and, together with its subsidiaries, the "Group") is pleased to announce the proposed acquisition of tastytrade, Inc. ("tastytrade"), a high growth US online brokerage and trading education platform with a leading position in US listed derivatives, primarily options and futures, and over 105,000 active accounts[1] (the "Acquisition").
§ Landmark transaction that expands and diversifies IG's growth drivers through entry into the world's largest listed derivatives market. With an estimated 1.5 million retail traders, the US options and futures market is larger than the rest-of-world CFD/FX and European Turbo markets combined[2].
§ tastytrade is highly complementary to IG's existing client offering, adding a leading[3] provider of exchange traded derivatives and increasing the contribution from agency-only activities.
§ The transaction significantly increases the scale and relevance of IG's existing US business through the acquisition of a fast-growing, high margin business that is well positioned to benefit from the structural growth in self-directed investing in the US listed options and futures market.
§ IG and tastytrade share a strong culture and client-centric ethos; both companies also focus on the same client demographic of ambitious, self-directed retail traders.
§ Total consideration of $1.0 billion to be paid to tastytrade's shareholders, comprising $300 million in cash and the issuance of 61.0 million IG shares, valued at $700 million[4].
§ Following completion of the Acquisition, key tastytrade management shareholders, comprising Tom Sosnoff (Co-CEO, tastytrade), Kristi Ross (Co-CEO and President, tastytrade), Scott Sheridan (CEO, tastyworks) and Linwood Ma (CTO, tastytrade), will join the IG senior leadership team and continue in their current roles to help drive further growth in the business, and will collectively own approximately 5.7% of the enlarged share capital of IG.
§ Financially attractive, with the Acquisition expected to be low single digit accretive to IG's adjusted earnings per share in the first full year post completion[5].
§ Completion of the Acquisition remains subject to the satisfaction of customary conditions, including regulatory and anti-trust consents in the US.
June Felix, Chief Executive of IG, commented, "I am thrilled to welcome tastytrade to the IG Group family. This acquisition will materially expand and scale our business in the US and see us further diversify into the exciting high growth market of US retail options and futures, a market which is adjacent to IG's core retail trading skill set. The US market has more than 1.5 million retail traders and is the largest derivatives market in the world. tastytrade has grown impressively and proven itself to be an innovative market disrupter passionately committed to delivering for their clients. The financial and strategic rationale underpinning this deal are compelling. I am confident that with our shared client-centric ethos, passion for innovation and growth, IG and tastytrade will prove a winning combination."
Tom Sosnoff, Co-Founder and Co-CEO of tastytrade, commented, "Early on we knew tastytrade was a very special company. While our long-term goal has always been to go global, we waited almost 10 years until we found the right partner and perfect match. Together we will focus on empowering the self-directed investor and change the way people perceive and engage with financial markets."
Kristi Ross, Co-Founder and Co-CEO of tastytrade, commented, "We created tastytrade with a vision to challenge self-directed investors to think and trade strategically. We built an ecosystem to empower them. No other firm has built a retail trader ecosystem in quite the same way: delivering authentic, fun and actionable research-based content through our uniquely developed financial media network; to our two revolutionary brokerage firms with intuitive front-end technology, built on high frequency middleware; to a retail-focused futures exchange. IG shares our mission, and similarly has a deep-rooted track record of innovation, leadership in the financial markets with a robust and scalable infrastructure, and most importantly, we share a customer-centric philosophy. We are excited to work with IG to make derivatives trading more accessible for retail investors around the world."
1. Information on tastytrade
tastytrade is a unique and fast-growing platform that provides differentiated financial content and trader education alongside a sophisticated options and futures brokerage. tastytrade was founded and is led by an entrepreneurial management team who previously created the highly successful options and futures trading platform, thinkorswim (acquired by TD Ameritrade in 2009). It operates through two primary entities: tastytrade, an online financial network that provides actionable trading content to knowledgeable retail traders, and tastyworks, a leading online brokerage platform enabling self-directed retail traders to trade US options and futures (84% options; 9% futures; 7% equities)[6]. The distinctive and differentiated client proposition has made tastytrade a disruptive force in the US retail options and futures market.
Founded in 2011, tastytrade's focus on trader education and original content, alongside its sophisticated brokerage offering, provides a clear competitive advantage over peers. With c.900,000 unique registrants, tastytrade is one of the most watched financial networks in the world[7], engaging traders across 190 countries, with 8 hours of cost-free, commercial-free, live interactive content daily, providing market commentary and actionable trading strategies related to options and futures trading and the stock market. Distributed through www.tastytrade.com, YouTube, iTunes, Apple TV, and others, the 50+ shows per week appeal to both beginner and advanced traders.
Launched in 2017, tastyworks is already a leading independent online brokerage platform for US exchange traded derivatives traders with a platform built on proprietary and highly scalable technology. Reflecting its distinctive client-focused philosophy and appeal to a wide client demographic, tastyworks has built a strong and fast-growing client base, which today comprises over 105,000 active accounts[8], and represents c.1.3% of the entire US equity options market (institutional and retail) by volume traded[9], while being ranked by Barron's as the second best online brokerage platform for active traders[10].
Together, tastytrade provides ambitious retail traders with the education and confidence to trade in derivative products, whilst tastyworks provides them with a powerful, modern and easy-to-use trading platform to utilise this knowledge.
tastytrade is headquartered in Chicago with c.145 employees. tastytrade opened brokerage operations in Australia in 2019 and is in the process of launching in Canada as part of its international expansion strategy.
In September 2019, tastytrade launched dough, a mobile-first brokerage firm radically challenging the status quo and changing wealth creation and the Quiet Foundation, a data science-driven, investment advisory service launched in 2018. tastytrade is also an 'incubator' of other fintech companies, including, The Small Exchange, a futures exchange platform focused on retail traders launched in 2020, and investor in Zero Hash, a crypto-currency infrastructure provider.
For the financial year to 31 December 2020, tastytrade delivered revenue of $116.2 million[11] (up 44% year-over-year; 31 December 2019: $81.0 million), Adjusted EBITDA of $54.1 million[12] (up 43% year-over-year; 31 December 2019: $37.8 million) and profit before tax of $49.0 million (up 5% year-over-year; 31 December 2019: $46.5 million), with growth in active accounts of 85%[13] over the same period, reflecting both structural sector growth and tastytrade's continued disruption of the US retail market. tastytrade's gross assets were $200.5 million[14] as at 31 December 2020, with a regulatory capital requirement of c. $0.5 million reflecting its agency-only brokerage model.
2. Background to and Reasons for the Acquisition
IG's strategy
IG is an award-winning, multi-product trading company providing retail, professional and institutional clients with access to trading opportunities in over 17,000 financial markets. As the world's number 1 provider of contracts for difference (CFDs)[15] and an established player in the foreign exchange (FX, forex) market, IG is already one of the foremost trading platforms in its Core Markets, including the UK, EU, Australia and Singapore.
Beyond its Core Markets, IG's strategy is focused on its Significant Opportunities portfolio, comprising the US, Japan, Emerging Markets and Greater China geographies, as well as the institutional channel through IG Prime and the European exchange traded derivative market through Spectrum.
IG has had a presence in the US retail trading market since 2007 through Nadex, the Chicago-based derivatives exchange for US and overseas traders. Nadex offers a range of products including binary options, call spreads and knockouts. In 2019, IG launched OTC FX trading for retail clients through its retail foreign exchange dealer (RFED) business. IG also operates in the US through DailyFX, a free news and research resource for FX, commodity and index trading.
Compelling strategic benefits for IG
Provides IG with immediate scale in the world's largest listed options and futures market
§ Establishes IG as an important player in the highly attractive and growing listed US options and futures market. With an estimated 1.5 million retail traders, the US options and futures market is larger than the global CFD/FX and European Turbo markets combined[16].
o The US equity options market grew at a CAGR of c.24% between 2017 and 2020, with average daily volume (ADV) of 27.7 million contracts for 2020[17]. During 2020, the number of options and futures traders grew by c.108%[18], reflecting growing retail appetite for options and futures trading following a period of heightened market volatility.
o Continued attractive market growth expected, driven by favourable structural trends, including the on-going shift towards self-directed investing and the continued 'democratisation' of financial markets. Retail participation has increased to nearly 25% of the entire US equity market in 2020 from a range of 10% to 15% over the previous four years, driven by improvements in technology and trader education, as well as greater market accessibility[19].
o tastytrade's brokerage, tastyworks, has grown its share of the US equity options market by volume from 0.4% at launch in 2017 to 1.3%[20] in 2020, reflecting its highly differentiated, education-led proposition for the retail client base.
§ Transforms the scale and breadth of IG's existing US presence through Nadex, the RFED and DailyFX and its relevance to US retail clients.
o Adds exchange traded futures, options and stock trading to IG's existing US product set comprising FX (through the RFED) and binaries (through Nadex).
o Both IG and tastytrade target a similar demographic of knowledgeable, self-directed retail traders. Over time, the enhanced client proposition is anticipated to translate into higher retention rates and revenue per client from the combined US client base.
Extends IG's global product capabilities into exchange traded options and futures, increasing the contribution from agency-only activities
§ Diversifies IG's regulatory risk profile beyond its historical focus on OTC trading into US exchange traded derivatives.
§ Increases the proportion of Group revenues from agency-only activities reflecting tastytrade's capital efficient business model[21].
o As a result of the Acquisition, IG's revenues linked to OTC derivatives would be expected to reduce from c.94% for the twelve months ended 30 November 2020 to c.85% on a pro forma basis[22]. IG expects the contribution from non-OTC revenues to grow over time as a consequence of the Acquisition as well as continued development of certain Significant Opportunities initiatives.
§ Combines IG's market-leading presence in the leveraged OTC space with tastytrade's highly complementary expertise in the exchange traded options and futures market, enabling IG to offer a broader suite of derivatives products to clients.
§ Longer-term opportunity for greater client penetration and cross-selling internationally through a broader proposition. 15% of tastytrade's funded accounts who seek to trade US exchange traded derivatives[23] are located outside the US. As tastytrade has a very small footprint outside the US, these clients represent unsolicited, inbound demand which highlights the attractiveness of the international growth opportunity over time. tastytrade recently established brokerage operations in Australia, where IG is a leading provider of CFD and FX trading products, while IG has a broad international presence and client footprint across Asia and Europe to which tastytrade's proposition could be extended over time.
Diversifies IG's geographic footprint and accelerates growth ambitions
§ Further enhances IG's position as a global multi-product trading platform with a leading presence in key global financial markets (US, UK, EU, EMEA, Asia, Australia) and over 340,000 active[24] clients worldwide.
o On a pro forma basis, based on tastytrade's unaudited financial results ended 31 December 2020 and IG's unaudited results for the twelve months ended 30 November 2020, the US would have contributed 13% of IG Group revenue, compared to 4% on a standalone basis for the twelve months ended 30 November 2020[25].
§ Accelerates IG's Significant Opportunities portfolio growth strategy.
o IG is well on track to achieve its published target of generating an additional £100 million of revenue, to around £160 million, from the Significant Opportunities portfolio by the end of the financial year ending 31 May 2022. The Acquisition is additive to this target, and any revised guidance will be provided in due course following completion of the Acquisition.
Acquisition of a high growth, high margin business
§ tastytrade has demonstrated exceptional client and revenue growth reflecting its strong and differentiated proposition within the expanding US options and futures market.
o tastytrade's revenues grew at a CAGR of 49% between financial years ended 31 December 2018 and 31 December 2020[26]. tastytrade's active accounts grew at a CAGR of c.64% during the same period.
o tastytrade generated an adjusted EBITDA margin of 47% in the year ended 31 December 2020[27]reflecting the highly scalable nature of its proprietary platform.
o tastytrade is well positioned to benefit from any recovery in US interest rates through higher interest income earned on client balances.
IG and tastytrade share a strong culture and client-centric ethos; both companies also focus on the same customer demographic of ambitious, self-directed traders
§ IG brings a track record of over 45 years in innovation and leadership in OTC products for a global, high-value client base and a modern, robust and scalable infrastructure.
§ tastytrade brings a leadership position in the attractive US listed derivatives market, a 105,000+[28] active retail client account base with high levels of retention, and an agency-only business model with significant growth potential.
§ Similar focus on ambitious, self-directed traders.
§ Shared focus on client service and the importance of trader education to raise clients' knowledge, awareness and confidence in trading financial products.
§ Shared passion for innovation.
§ Common entrepreneurial ethos combined with a culture of regulatory compliance and client-centric focus.
Strong financial rationale
Clear financial benefits for IG's shareholders
§ Further strengthens IG's profitability and cash flow profiles.
§ Positions IG to drive additional long-term earnings growth through the acquisition of a fast-growing business operating at attractive profit margins and delivering strong cash conversion.
§ Transaction expected to be low single digit accretive to IG's adjusted earnings per share[29] in the first full year post completion.
Lower risk transaction with limited integration
§ No significant or complicated integration required, minimising integration risk and associated costs.
§ No cost synergies from tastytrade required, given complementary products and business operations.
§ Attractive acquisition opportunity in options and futures trading that is adjacent to IG's core retail trading proposition, complementing IG's existing organic growth strategy in its Core Markets.
§ Experienced senior management team with a proven track record.
§ Alignment of interests through phased five year lock-up period on IG shares for key tastytrade management shareholders.
§ Management continuity enabled through four year retention program for other employees, funded by tastytrade's shareholders.
§ Limited risk of client attrition, with tastytrade to continue to operate as a standalone division under its existing brands.
3. Key Transaction Terms
§ Total consideration of $1.0 billion (£734 million[30]) to be paid to tastytrade's shareholders, comprising: (i) cash consideration of $300 million (£220 million); and (ii) the issuance to tastytrade shareholders of 61.0 million new shares[31] in IG valued at $700 million (£514 million).
§ Cash requirement to be funded by £150 million of new debt facilities with the balance from IG's own cash resources.
§ At completion:
o tastytrade shareholders will own, in aggregate, approximately 14.1% of the enlarged share capital of IG.
o Key tastytrade management shareholders, comprising Tom Sosnoff (Co-CEO, tastytrade), Kristi Ross (Co-CEO and President, tastytrade), Scott Sheridan (CEO, tastyworks) and Linwood Ma (CTO), will collectively own approximately 5.7% of the enlarged share capital of IG, with a phased five year lock-up period.
o These individuals have also entered into full-time employment contracts with IG which contain comprehensive non-compete and non-solicit obligations.
o tastytrade's two largest institutional shareholders, TCV and Lightbank, will also become shareholders in IG with an approximate 5.7% shareholding and will have a six month lock-up period post completion.
§ Completion of the Acquisition is anticipated to occur in the first quarter of financial year ending 31 May 2022, subject to satisfaction of customary conditions. These include receipt of relevant anti-trust and regulatory approvals from US regulatory bodies, including FINRA, as the Acquisition involves the acquisition of 25% or more of a registered broker-dealer.
Presentation to analysts and investors
There will be an analyst and investor presentation at 9:30am (UK Time) on Thursday 21 January.
The presentation will also be accessible live via audio webcast at https://pres.iggroup.com/ig054. If you wish to listen via conference call, please use the following link https://pres.iggroup.com/ig054/vip_connect. The audio webcast of the presentation and a transcript will be archived at: www.iggroup.com/investors.
Enquiries:
IG Group Holdings plc
Liz Scorer, Head of Investor Relations
+44 (0) 20 7573 0727
Ramon Kaur, Head of Communications
+44 (0) 73 8844 0127 +44 (0) 20 7896 0011
FTI Consulting
Edward Berry
+44 (0) 77 03 330 199
Neil Doyle
+44 (0) 77 71 978 220
Jefferies International Limited (Lead Financial Advisor to IG)
Alexander Yavorsky
+1 212 284 4667
Philip Noblet
+44 (0) 20 7548 4230
Raymond Bader
+1 212 323 3925
Fenchurch Advisory Partners LLP (Lead Financial Advisor to IG)
Kunal Gandhi
+44 (0) 20 7382 2239
Rob Williams
+44 (0) 20 7382 8141
Divya Dhar
+44 (0) 20 7382 8144
Barclays (Financial Advisor and Corporate Broker to IG)
Neal West
+44 (0) 20 7773 8824
Darren McKay
+44 (0) 20 7116 2828
Tom Macdonald
+44 (0) 20 3134 9920
Numis (Financial Advisor and Corporate Broker to IG)
Charles Farquhar
+44 (0) 20 7260 1000
Stephen Westgate
+44 (0) 20 7260 1000
APPENDIX I
ADDITIONAL UNAUDITED FINANCIAL INFORMATION ON TASTYTRADE
|
Financial years ending 31 December (in $m)[32] (unless otherwise noted) |
FY20[33] |
FY19 |
FY18 |
|
Total Revenues |
116.2 |
81.0 |
52.1 |
|
Adjusted EBITDA[34] |
54.1 |
37.8 |
21.2 |
|
Profit Before Tax |
49.0 |
46.5 |
18.8 |
|
|
|
|
|
|
Total Gross Assets[35] |
200.5 |
157.4 |
118.1 |
|
Net Assets[36] |
184.1 |
148.4 |
114.2 |
|
|
|
|
|
|
Funded Accounts (000) |
125.2 |
69.3 |
44.0 |
|
Active Accounts (000)[37] |
106.3 |
57.4 |
39.3 |
|
Client Assets[38] |
2,505 |
1,450 |
971 |
|
Options Contracts Traded (000) |
101,178 |
61,128 |
37,117 |
Notice to all investors subject to discussion with IG
Jefferies International Limited ("Jefferies") is authorised and regulated by the Financial Conduct Authority. Jefferies is acting exclusively for IG Group Holdings plc and no one else in connection with the possible offer for tastytrade, Inc. and will not be responsible to anyone other than IG Group Holdings plc for providing the protections afforded to clients of Jefferies nor for providing advice in connection with the possible offer for tastytrade, Inc. or any matter referred to herein.
Fenchurch Advisory Partners LLP ("Fenchurch") is authorised and regulated by the Financial Conduct Authority. Fenchurch is acting exclusively for IG Group Holdings plc and no one else in connection with the possible offer for tastytrade, Inc. and will not be responsible to anyone other than IG Group Holdings plc for providing the protections afforded to clients of Fenchurch nor for providing advice in connection with the possible offer for tastytrade, Inc. or any matter referred to herein.
Barclays, which is authorised by the Prudential Regulation Authority and regulated in the United Kingdom by the Financial Conduct Authority and the Prudential Regulation Authority, is acting exclusively for IG and no one else in connection with the possible offer for tastytrade and will not be responsible to anyone other than IG for providing the protections afforded to clients of Barclays nor for providing advice in relation to the possible offer for tastytrade or any other matter referred to in this announcement.
Numis Securities Limited ("Numis"), which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting exclusively for IG and no one else in connection with the matters set out in this announcement and will not regard any other person as its client in relation to the matters in this announcement and will not be responsible to anyone other than IG for providing the protections afforded to clients of Numis, nor for providing advice in relation to any matter referred to herein.
Forward-looking statements
This announcement may contain forward-looking statements about IG and its subsidiaries (the "Group"). Such forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes", "projects", "estimates", "plans", "anticipates", "targets", "aims", "continues", "expects", "intends", "hopes", "may", "will", "would", "could" or "should" or, in each case, their negative or other variations or comparable terminology.
Forward-looking statements involve known and unknown risks, uncertainties, assumptions and other factors which are beyond IG's control and are based on IG's beliefs and expectations about future events as of the date the statements are made. If the assumptions on which the Group bases its forward-looking statements change, actual results may differ from those expressed in such statements. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements, including those set out under "Principal Risks" in IG's Annual Report for the financial year ended 31 May 2020. The Annual Report can be found on IG's website (www.iggroup.com).
Forward-looking statements speak only as of the date they are made. Except as required by applicable law and regulation, IG undertakes no obligation to update these forward-looking statements.
No offer or solicitation
This announcement is not intended to, and does not constitute, or form part of, any offer to sell or an invitation to purchase or subscribe for any securities or a solicitation of any vote or approval in any jurisdiction.
No profit forecasts or estimates
No statement in this announcement is intended as a profit forecast or estimate for any period and no statement in this announcement should be interpreted to mean that earnings or earnings per share for IG Group Holdings plc or tastytrade, Inc., as appropriate, for the current or future financial years would necessarily match or exceed the historical published earnings or earnings per share for IG Group Holdings plc or tastytrade, Inc.
[1] Represents accounts that traded at least once during the 12 months ended 31 December 2020.
[2] Latest Investment Trends market reports and internal estimates.
[3] tastyworks was ranked the second best online broker for active traders by Barron's in its "Best Online Brokers for 2020" report.
[4] Based on the 40 day Volume Weighted Average Price up to and including the 19th January 2021 of 842.7 pence. Currencies converted from USD to GBP at a rate of 1.3617 as of 19th January 2021. Source: Bloomberg.
[5] EPS presented on adjusted basis to exclude amortisation of acquired intangibles (non cash), utilisation of transaction-related DTA (non cash), compensation expense related to the vesting of tastytrade employee retention package, and one-off transaction costs.
[6] Based on number of trades for the twelve months ended 31 December 2020.
[7] Based on YouTube subscribers among the leading US brokerages.
[8] Represents accounts that traded at least once during the 12 months ended 31 December 2020.
[9] For the twelve months ended December 2020. Represents tastyworks' equity options average daily volume (ADV, # of contracts) divided by total equity options ADV recorded by the Options Clearing Corporation ("OCC").
[10] Source Barron's, "Best Online Brokers for 2020" report.
[11] Financial information for year ended 31 December 2020 is on an unaudited US GAAP basis.
[12] Financial information for year ended 31 December 2020 is on an unaudited US non-GAAP basis. See page 36 of Investor Presentation for reconciliation of Adjusted EBITDA to GAAP Profit after Tax.
[13] Represents growth in accounts that traded at least once during the 12 months ended 31 December 2020 relative to the prior year.
[14] Financial information for year ended 31 December 2020 is on an unaudited US GAAP basis. The terms of the transaction stipulate that tastytrade will be acquired on a cash free / debt free basis subject to a minimum agreed level of cash to be retained in the business. Prior to closing, it is expected that tastytrade will distribute to tastytrade shareholders any cash that is on the balance sheet at such time in excess of this amount. As at 31 December 2020, tastytrade had $112.0 million of cash & cash equivalents.
[15] Based on revenue excluding FX (from published financial statements, June 2020).
[16] Latest Investment Trends market reports and internal estimates.
[17] Source: OCC.
[18] Source: Investment Trends 2020 US Active Trader Report.
[19] Public Rule 605 filings.
[20] For the twelve months ended 31 December 2020. Represents tastytrade's equity options ADV divided by total equity options ADV recorded by the OCC.
[21] As at 31 December 2020, tastytrade had a regulatory capital requirement of $500k.
[22] Pro forma based on adding IG's IFRS unaudited figures for the twelve months ended 30 November 2020 to tastytrade's unaudited figures for financial year ended 31 December 2020 on a US GAAP basis. tastytrade's financials are subject to reconciliation to IG's accounting policies. tastytrade's financials converted to GBP using the average GBP/USD exchange rate over the period from 1 January 2020 to 31 December 2020 of 1.2840.
[23] As at 31 December 2020.
[24] Pro forma figure based on adding IG's number of active clients with tastytrade's active accounts. Active client for IG is defined as any client who has generated revenue through leveraged trading, or was holding a stockbroking position for the 6 months period ended 30 November 2020. Active account for tastytrade represents any account that traded at least once during the 12 months ended 31 December 2020.
[25] Pro forma figure based on adding IG's IFRS unaudited figures for the twelve months ended 30 November 2020 to tastytrade's unaudited figures for financial year ended 31 December 2020 on a US GAAP basis. tastytrade's financials are subject to reconciliation to IG's accounting policies. tastytrade's financials converted to GBP using the average GBP/USD exchange rate over the period from 1 January 2020 to 31 December 2020 of 1.2840.
[26] CAGR based on tastytrade's revenue figures on a US GAAP basis. Revenue for financial year ended 31 December 2020 is unaudited.
[27] Figures for financial year ended 31 December 2020 are unaudited and on a non-GAAP basis. See page 36 of Investor Presentation for reconciliation of Adjusted EBITDA to GAAP Profit after Tax.
[28] Represents accounts that traded at least once during the 12 months ended 31 December 2020.
[29] EPS presented on adjusted basis to exclude amortisation of acquired intangibles (non-cash), utilisation of transaction-related DTA (non-cash), compensation expense related to the vesting of tastytrade employee retention package, and one-off transaction costs.
[30] Currencies converted from USD to GBP at a rate of 1.3617 as of 19th January 2021. Source: Bloomberg.
[31] Based on the 40 day Volume Weighted Average Price up to and including the 19th January 2021 of 842.7 pence. Source: Bloomberg.
[32] Based on tastytrade's unaudited financials for financial year ended 31 December 2020 and audited financials for financial years ended 31 December 2019 and 31 December 2018 on a US GAAP basis and are subject to reconciliation to IG's accounting policies.
[33] Based on tastytrade's unaudited financials for financial year ended 31 December 2020 on a US GAAP basis.
[34] See page 36 of Investor Presentation for reconciliation of Adjusted EBITDA to GAAP Profit After Tax.
[35] The terms of the transaction stipulate that tastytrade will be acquired on a cash free / debt free basis subject to a minimum agreed level of cash to be retained in the business. Prior to closing, it is expected that tastytrade will distribute to tastytrade shareholders any cash that is on the balance sheet at such time in excess of this amount. As at 31 December 2020, tastytrade had $112.0 million of cash & cash equivalents.
[36] The terms of the transaction stipulate that tastytrade will be acquired on a cash free / debt free basis subject to a minimum agreed level of cash to be retained in the business. Prior to closing, it is expected that tastytrade will distribute to tastytrade shareholders any cash that is on the balance sheet at such time in excess of this amount. As at 31 December 2020, tastytrade had $112.0 million of cash & cash equivalents.
[37] Represents number of accounts that traded at least once during the twelve months ended December 2020, December 2019 and December 2018, respectively.
[38] Represents assets under management (net liquidation value of tastytrade's clients).
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