Refco Returns
The Man Group, the world’s largest publicly traded hedge fund operator, said Friday that it would spin off its brokerage division to focus on its asset management unit.The step has been in the works for years but was delayed to give Man time to integrate into its brokerage operation some customer accounts and assets it acquired in 2005 from Refco, the American futures broker that went bankrupt.
Man, based in London, plans to list a majority stake in the brokerage unit, which will be renamed MF Global, on the New York Stock Exchange in the third quarter of this year and return the proceeds to shareholders.
The business, which focuses on derivatives and generates about 15 percent of the group’s profit, may be worth about $5 billion, analysts estimated. The public stock offering will give investors a chance to benefit from the explosive growth of the derivatives market, said Geoff Miller, an analyst at Bridgewell Securities in London. (emphasis added
Man Group bid $282 Million for Refco. The purchase price might have been less depending on how many customers left Refco.
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