Brexit backer Peter Cruddas eyes EU bolt-hole for CMC Markets

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A key backer of the Vote Leave campaign, spread-betting multi-millionaire Peter Cruddas, today admitted his company could need a new European headquarters after a Brexit.

Cruddas, the founder of CMC Markets who has donated more than £1 million to the Leave campaign, insisted that the business’s headquarters would remain in the UK. 

But CMC is likely to need a new base in the European Union following a Brexit, to benefit from the financial passporting regime which allows firms to offer financial services in other EU countries. 

Europe accounts for a third of CMC’s business.

The chief executive (pictured) said: “The UK would stay where it is. We would wait and see what the renegotiations bring and how we are going to exit, and then we would address the issue and one of the options open to us is to create a central headquarters, a headquarters in mainland Europe which could hub our European offices.”

Finance director Grant Foley added that “we clearly have contingency plans in place whatever way the vote goes” and that there were a “couple of options” being considered for the European base. 

Germany and Ireland are possible locations. 

Cruddas added there would be no jobs in London lost if CMC was forced into the move. “We’re looking for staff. We’re not getting rid of staff so we wouldn’t be laying people off,” he said. 

CMC’s annual pre-tax profits jumped 20% to £62.4 million in the year to March 31, the first results since Cruddas, worth an estimated £780 million, landed a £200 million windfall by floating the business in February. 

CMC, targeting wealthier clients, benefited from volatile markets, including a record month last August. 

The company grew its active clients by 14% to 57,329, each earning the business an average £2828.

But Cruddas added that traders had become more “cautious” ahead of the crucial vote. Of more recent trading, he said: “Trade numbers are up and our client metrics are strong but it is just that they are not trading in such large amounts at the moment. 

“They are being a little bit cautious ahead of Brexit, but we think that once Brexit’s cleared out of the way it will improve. The last four or five weeks, once the campaign got going, people have been generally cautious.”

Despite the float, Cruddas still owns 57% of the company and CMC’s 8.9p dividend for 2016 lands him a payout of nearly £15 million. 

The former Conservative party co-treasurer, who set up CMC in 1989, was caught in a cash-for-access sting by the Sunday Times in 2012. 

He successfully sued the newspaper for libel, although his winnings were reduced on appeal.

Source Article from http://www.standard.co.uk/business/brexit-backer-peter-cruddas-eyes-eu-bolthole-for-cmc-markets-a3266596.html

June 8, 2016 |
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