KCG Holdings (KCG) – Odd Lot Tender Offer – risk free upside of $50

Current Price – $13.48

Offer Price – $13.5 - $14

Upside – 3.7% or $50 (for odd lot holders if upper pricing limit is used)

Expiration date –  2 June 2015

SEC Filling

 

Summary:

KCG Holdings, Inc. is offering to purchase for cash up to $330,000,000 of shares of our Class A Common Stock, par value $0.01 per share, at a price not greater than $14.00 nor less than $13.50 per Share, net to the seller in cash.

If the Offer is fully subscribed at a Purchase Price of $14.00, the maximum Purchase Price pursuant to the Offer, the completion of the Offer will result in the repurchase by KCG of 23,571,428 Shares, which would represent approximately 21.6% of our issued and outstanding Shares, or 16.1% of our outstanding Shares on a fully diluted basis. If the Offer is fully subscribed at a Purchase Price of $13.50, the minimum Purchase Price pursuant to the Offer, the completion of the Offer will result in the repurchase by KCG of 24,444,444 Shares, which would represent approximately 22.4% of our issued and outstanding Shares, or 16.7% of our outstanding Shares on a fully diluted basis.

 

No proration for Odd Lot holders:

First, we will purchase all odd lots of less than 100 Shares from stockholders who properly tender all of their Shares at or below the Purchase Price and who do not properly withdraw them before the Expiration Date.

 

Source of Funds:

Assuming the Offer is fully subscribed, we expect the aggregate purchase price for the Shares acquired pursuant to the Offer, together with all related fees and expenses, to be $335 million. We expect to fund the Share purchases in the Offer, and to pay related fees and expenses, from our working capital. The Offer is not subject to a financing contingency.