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Gain Capital Sees More Directors Vote Against Acquisition from INTL FCStone

Through a regulatory filing made, GAIN Capital Holdings Inc had announced that two of its Board of Directors members no longer support the merger with INTL FCStone Inc. These members were Chris Sugden and Peter Quick.

Shift In Sentiment

Back in February of this year, INTL FCStone Inc announced that it had reached and subsequently entered a definitive agreement. This agreement pertains to the acquisition of one GAIN Capital Holdings Inc. The deal in question would see INTL FCStone buy the entirety of GAIN for $6 per share, doing so via an all-cash transaction. When you crunch the numbers, it represents an approximate of $236 million in total equity value for GAIN.

However, things seemed to have started to shift in sentiment, particularly for Quick and Sugden. Both are convinced that Gain’s performance since the signing of the merger agreement, said agreement valuing GAIN at $6 per share, no longer reflects the value of GAIN capital’s long term worth.

Coming Close, But No Cigar

With these two in opposition to the agreement, the total number of Directors against the merger, as it stipulates in the agreement, stands at three. Sugden and Quick had joined Alex Goor’s side, all of which are urging stockholders not to adopt the merger agreement. Should the acquisition reach fruition, GAIN would become a wholly-owned subsidiary of INTL FCStone.

Even so, these three people couldn’t stand against the rest of the GAIN Board and were subsequently outvoted. The final tally for the votes was at five against three, the voting itself done on the 15th of May, 2020. Thus, the company has reaffirmed its recommendation that its stockholders should adopt the Merger Agreement.

The Official Documents

Subsequently, a document was filed to the US Securities and Exchange Commission, or SEC, explaining the event’s actions. The filing states that the GAIN Board had taken into consideration a wide range of factors in order to conclude the continued recommendation that stockholders should adopt the Merger Agreement.

This includes all the factors for the merger in the section titled, rather aptly, “GAIN’s Reasons for the Merger.” This, according to the filing, began on the 38th page of the Definitive Proxy Statement.

Further reasoning for the merger to occur would be found in another segment, according to the filing. This segment was titled “Reasons For Recommendation Following Subsequent Developments.” This equally aptly titled segment began on the 42nd page of the Definitive Proxy Statement, according to the SEC filing.

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