CMC float set to bag £80m

James Quinn meets a man whose family will net the thick end of £260m but who will stay at CMC’s helm.

Peter Cruddas is a man on a mission. One that is by no means complete. Having set up online financial trading firm CMC Markets in 1989 with just £10,000, and, despite his 52 years of age, he booms: “Are you joking?” when asked if the company’s £800m float is a precursor to his stepping down at some time in the near future.

“I’ll be here 20 years from now,” he retorts, at which time, he says, there will be the opportunity for some succession planning.

“I don’t see anything wrong with someone still working at 70, and, as long as it’s enjoyable, I will be here,” says Mr Cruddas, on the first day of an institutional roadshow to market the company’s shares.

His obvious commitment can be seen in the fact that he – and the company’s enlarged board – are keen for him to continue with his dual role of chairman and chief executive after CMC floats next Thursday.

“My being here is a positive,” he says. “No one knows this company better than I, and everyone involved is reassured by my being here.”

Does that stand for the institutions he is currently courting? “They’re playing their cards close to their chests.”

But in reality he is unlikely to come up against too much opposition on that count so long as CMC, which also owns the deal4free spread-betting firm, continues to grow at the rate it has.

The business expanded throughout the 1990s, harnessing the growth in retail investors up to and beyond the dotcom boom, with latest figures showing a profit before tax of £10m on sales of £75.7m in the year to March 2006.

The float, the planning for which began last July when bankers Deutsche Bank and JP Morgan Cazenove were brought on board, will see Mr Cruddas cash in on the best part of £260m.

He and second wife Fiona own 92.2pc of the shares before listing, with his family’s wealth recently valued at £864m.

Even once CMC floats, the Cruddases will still own 60pc. “I’ve scaled back the ‘greenshoe’ [which allows CMC's banks to sell more shares than originally planned if demand is strong] from the usual 15pc to 10pc to ensure my holding still begins with a six.” After first flinching at the “overly glamorous” suggestion that he flies from his Monaco home every Monday morning to CMC’s City of London base, he goes on to explain about the company’s aggressive expansion plans, in which he is intrinsically involved.

The plan is to open seven new offices – including in Tokyo and in Singapore – with a smattering around Europe.

Expansion can be done relatively economically by using dedicated trading rooms in London and Sydney, covering all opening hours.

Mr Cruddas explains that, through this offering, and by working with 55 corporate partners, he can offer institutional pricing to retail investors.

Handing over his mobile phone, he shows a screen offering real-time currency prices. “This is what it’s all about,” he says.

Of the £80m of new money being raised in the float, £25m will be spent on the next technology, on top of the $60m (£31m) spent over the past 11 years.

But it’s not all about future investment. “Even if we stood still it’s jam today and jam tomorrow,” says Mr Cruddas, confident the business is robust enough to withstand the current market volatility.

After all, he argues, the business is based on volatility, and so as long as there are people wanting to take a punt on the markets, CMC will profit.

And, rather than just him profiting, he is handing 7pc of the company to more than 100 staff as part of a lock-in to ensure his best staff stay with him to increase the size of CMC’s book.

For the man who began life as the son of an East End market porter, there is still much to do.

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