What happens when a company thats No. 1 in its field turns into something completely different? Having bulked up in technology and electronic trading since the turn of the century, ICAP, the longtime leader in interdealer brokerage, agreed in November to transfer its voice and hybrid brokering and related information businesses to rival Tullett Prebon. The new ICAP becomes what group CEO Michael Spencer calls a pure posttrade services and electronic trading group. The e-trading business, which produced £259 million ($384 million) of ICAPs total £1.3 billion in revenue in the fiscal year ended in March 2015, is led by Gil Mandelzis, who describes the redefined ICAP as a true fintech company and supermarket of liquidity. Mandelzis joined the London-based firm in 2007, when it acquired transaction processor Traiana, which he founded and which now resides in the posttrade segment (£228 million in fiscal 2015 revenue, led by Jenny Knott). Mandelzis moved on to become CEO of ICAPs EBS foreign exchange marketplace. Late in 2014, ahead of the integration of fixed-income platform BrokerTec with EBS, Mandelzis was named CEO of EBS BrokerTec. That combination results in powerful operating leverage, he says. Capital investments of more than $100 million over several years and upgrades in EBS technology and products now extend to BrokerTec as well. Mandelzis, 47, believes the units size and synergies raise barriers to entry that will keep potential competitors at bay. The market will converge around fewer supermarket players, highly integrated and with economies of scale, he says. For ICAP the addressable market expands massively any institutional client, any trading style, anywhere in the world.
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