TradeStation began offering crypto trading to its customers in May 2019, and last year partnered with exchange ErisX to integrate ErisX’s order book into its subsidiary, TradeStation Crypto.
The SPAC transaction is expected to close in the first half of 2022. TradeStation will list on the New York Stock Exchange under the ticker “TRDE.”
The transaction values the combined company at an implied pro forma enterprise value of approximately $1.43 billion. After the deal closes, TradeStation parent company Monex will own approximately 80% of the combined company. TradeStation’s existing management team will remain in place.
The deal will provide $316 million of cash before paying expenses, assuming there’s no redemption of any public shares of Quantum FinTech. The total includes $201 million in cash held in Quantum FinTech’s trust account and $115 million through a private investment in public equity (PIPE), or a private sale of Quantum stock. The PIPE includes $50 million from Monex and $50 million from Galaxy Digital, plus investments from XBTO Ventures, LLC and Appian Way Asset Management.
The combination structure involves a merger between a new subsidiary of TradeStation and Quantum Fintech, with Quantum becoming a wholly owned subsidiary of TradeStation. Each Quantum FinTech share held by the PIPE investors and sponsors will be exchanged for one common share of TradeStation. Quantum shareholders who don’t redeem the public shares will receive more than one TradeStation share.
“There are numerous reasons why TradeStation is, in our judgment, the most attractive company we looked at in the fintech/financial services sector, and we looked at quite a few,” said John Schaible, chairman and CEO of Quantum FinTech, in a press release. “TradeStation owns its core trading platform technology, and it executes and clears its customer trades across all of the major asset classes it offers. This high level of control over both its technology and operations gives TradeStation valuable agility and flexibility in how it runs and grows its business, as well as the ability to scale efficiently.”
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