U.S. Futures Giant StoneX Completes RJO Acquisition, Emerges as Largest Non-Bank Futures Broker in America
In a move that is set to shake up the derivatives market, StoneX Group Inc. has announced the acquisition of R.J. O'Brien, one of the largest non-bank Futures Commission Merchants (FCMs) in the U.S. This deal makes StoneX the largest non-bank FCM in the country and a global leader in derivatives.
The acquisition, which is expected to close soon, adds approximately $766 million in revenue and $170 million in EBITDA from R.J. O'Brien’s operations, substantially boosting StoneX’s financial profile. R.J. O'Brien, established in 1914, manages over 75,000 client accounts and operates one of the largest networks of introducing brokers, providing StoneX with a significant boost in client base.
Gerry Corcoran, CEO of RJO, is optimistic about maintaining RJO's client-focused service culture through the merger with StoneX. He believes that the merger will provide RJO clients with new access to StoneX's suite of services, including OTC hedging, commodity trading and logistics, and fixed income markets.
For StoneX, the acquisition brings several strategic benefits. The CEO of StoneX, Philip Smith, noted the strategic benefits of scale, broader client reach, and complementary technologies. He believes that the integration will enhance their capabilities across multiple asset classes. The Executive Vice-Chairman of StoneX, Sean O'Connor, emphasized the merger as a pivotal moment and the combined 200 years of expertise.
John O'Brien Jr., representing RJO's majority shareholders, praised the firm's 111-year legacy and expressed confidence in StoneX honoring that heritage. He believes that the merger will provide RJO with the resources and scale needed to compete in today's fast-paced financial market.
The integration aims to drive $50 million in expense reductions and unlock another $50 million in capital synergies. Cross-selling between OTC derivatives, commodity trading, and fixed income is expected to create further revenue upside.
However, the integration will require a substantial capital commitment and poses some risk of client attrition during the transition. On Thursday, SNEX closed at $97.24, down 0.57%, and rose to $97.60 after hours, up 0.37% on the NasdaqGS.
In conclusion, the acquisition significantly increases StoneX’s market presence, revenue, and client reach, while also enhancing profitability metrics and operational scale. The combined entity, following the acquisition, provides clients with access to nearly all major global derivatives exchanges, positioning it as a dominant force in U.S. and global derivatives markets.
[1] StoneX Group Inc. Press Release [2] R.J. O'Brien Press Release [3] Financial Times Article [4] Wall Street Journal Article
- This acquisition will significantly increase StoneX's financial profile, with approximately $766 million in revenue and $170 million in EBITDA from R.J. O'Brien's operations.
- The merger between StoneX and R.J. O'Brien is expected to drive growth in various business areas, including OTC hedging, commodity trading, and fixed income markets.
