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As StoneX Group Inc. (NASDAQ: SNEX) prepares to finalise its recently announced acquisition of Paris-based Fixed income trading house Octo Finances (contingent on regulatory approval from the ACPR), the global financial services firm is demonstrating its commitment to growth across diverse markets. This latest move is part of a long history of strategic acquisitions and expansions that have transformed StoneX from its humble beginnings into a Fortune 500 company.
The StoneX group's roots trace back to 1924 when Saul Stone, started a door-to-door egg wholesaler in Chicago. The business evolved into Saul Stone and Company, a butter and egg broker that eventually became a member of the Chicago Mercantile Exchange in 1938. Decades later, Saul Stone & Co. merged with Farmer's Commodity Corporation to form FCStone Group, Inc.
The group's modern era began in 2009 when FCStone Group merged with International Assets Holding Corporation (IAHC), founded by Diego Veitia. This merger created INTL FCStone, which would later rebrand as StoneX in 2020. The combined group embarked on an aggressive acquisition strategy, significantly expanding its global reach and full-service capabilities.
Key acquisitions over the years have included:
▪️ 2010: Hanley Group Ltd, enhancing StoneX's OTC trading capabilities
▪️ 2011: HCEnergy, expanding the company's energy risk management portfolio
▪️ 2014: Sinclair and Company, strengthening its position in dairy, grains, and livestock markets
▪️ 2015: G.X. Clarke & Co, boosting its fixed-income securities dealing
▪️ 2016: Sterne Agee's clearing and RIA businesses
▪️ 2018: GMP's US-based fixed-income trading business
▪️ 2019: UOB Bullion and Futures Limited's brokerage business in Singapore
▪️ 2020: Exotix Partners LLP, Tellimer Capital Ltd (Nigeria) and the broking business of Tellimer Markets Inc
▪️ 2020: GAIN Capital Holdings Inc., a major move into retail forex trading
This history of strategic growth has established StoneX as a global player in financial services, ranking 59th on the Fortune 500 list as of 2023.
Anthony Di Ciollo, Global Head of Fixed Income, StoneX
Now, as StoneX sets its sights on further expansion, Anthony Di Ciollo, Global Head of Fixed Income at StoneX, shared insights on a call from his visit to StoneX’s office in Argentina about the group's global outlook. Looking at prospects for Argentina he said, "With Milei now in charge and capital restrictions likely easing, there will be a lot of opportunities ahead for our U.S. team, U.S. LATAM team, and U.K. team," Di Ciollo explained. This optimism about Argentina reflects StoneX's ability to identify growth opportunities in diverse markets.
While emerging markets like Argentina offer exciting prospects, StoneX is simultaneously bolstering its position in core financial hubs. The pending acquisition of Octo Finances in Paris is a prime example of this dual-pronged strategy, allowing the firm to expand its European fixed income services while maintaining a keen eye on developing markets.
The acquisition of Octo Finances, expected to close in the coming months (pending approval from the ACPR), marks a significant step in StoneX's strategy to expand its fixed income services and client base in Europe, building upon the acquisition of SEC-registered institutional US Fixed Income house G.X. Clarke and Co. in 2015.
Founded 33 years ago, Octo Finances brings approximately 500 institutional clients to StoneX, along with expertise in European credit sales, trading, and debt capital markets (DCM). Di Ciollo emphasized the strategic fit: " When we saw the chance to acquire the outstanding company that Talabor [Szabo] and Arnaud [de Bourrousse] built from the ground up, with a client reach that would take us decades to achieve organically, we knew it was the perfect fit."
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Talabor Szabo, CEO, Octo Finances | Arnaud De Bourrousse, Chairman of the Board, Octo Finances |
Octo Finances was founded in 1991 by Talabor Szabo and Arnaud de Bourrousse as a specialist in bond intermediation in the French market, and soon expanded to cover the entire Eurozone by 1990, backed up by a credit research department that has to date published over 75,000 pieces of research. The company now has specialised departments for debt capital markets catering to SMEs and mid-tier companies (established in 2007) and a Public Debt department managing public sector bond issues. Octo Finances serves over 1,000 institutional clients across Europe, North America, the Middle East and Asia, covering typical buyside clients (insurance companies, pension funds, hedge funds etc) and public and private issuers.
For Octo Finances, joining StoneX offered an opportunity for growth and an expanded product range with the right partner. Talabor Szabo, CEO of Octo Finances, explained: "After COVID, things became a little bit more complicated, with much more compliance and less margins on our products. We said, okay, we can't last small like that. StoneX has tons of other products on all types of markets, not only fixed income but also equity and others. For us, it was really a perfect sale, a perfect mix."
The deal for StoneX to acquire Octo Finances, subject to regulatory approval, is expected to create synergies across multiple business lines. Di Ciollo noted: "Octo Finances' client base is a perfect match for the broad range of products we can offer, from payments, FX, and custody clearing to equities, allowing us to enhance the services we provide to their clients.."
Brexit's impact on the European financial landscape played a role in shaping this acquisition. Talabor highlighted how Brexit has influenced client preferences: "It did help our business, frankly, the past three, four years. People want to deal with French people, with either France, the French clients, of course, with France, but even German, or Spanish, I mean, they still prefer dealing with a guy in France, than in England."
Di Ciollo added that while Brexit wasn't the primary driver of the acquisition, it has influenced their European strategy: " We had a Brexit strategy in place and we were prepared for it, but this move would have happened regardless because the fit was so natural for us."
The acquisition also solidifies Paris as a key European hub for StoneX. Talabor emphasized the city's growing importance in post-Brexit Europe: “Banks with major London presence were attracted to Paris and have found it easier to build cohesive pan European operations for a number of reasons. With a diversified financial services environment, Paris has a strong presence in asset management, insurance and capital markets. Paris has a rich and diverse talent pool and the ease of use of the Eurostar for daily and intraday in and outbound travel, is also a factor that cannot be dismissed.”
Looking ahead, StoneX has ambitious plans for growth in Paris. "I can see us having over 100 people in Paris inside of three years," Di Ciollo stated. This expansion would more than quadruple the current Octo Finances team of about 25 employees.
Both companies emphasized the importance of cultural fit and shared entrepreneurial spirit. "They are patient, it's not like many of the other companies who wanted to buy us. Those firms would integrate us very quickly, and we would disappear in a fixed income department. Here, we're going to build a great business together," Talabor added.
This acquisition positions both StoneX and Octo Finances to capitalize on new opportunities in the European markets and beyond. With complementary strengths and a shared vision for growth, the combined entity looks set to make significant strides in the fixed income space, while also exploring emerging markets like Argentina.
Di Ciollo summed up the company's growth philosophy: "We are always thinking about long-term relationships, and once the business is simplified in this way, it tends to works out." This approach, coupled with StoneX's global vision, suggests that the Octo Finances acquisition may be just the beginning of a broader expansion strategy in Europe and emerging markets.
