IG Group to Acquire Freetrade for £160M in Strategic Expansion Move

IG Group Holdings plc (IG), a leading global provider of trading and investment solutions, has announced its acquisition of Freetrade, a rapidly growing, commission-free, self-directed investment platform, for £160 million. The deal, expected to complete by mid-2025 pending regulatory approvals, represents a significant step in IG’s strategy to expand its UK market presence and offerings.

IG's Acquisition Targets Growth in UK Trading and Investments

The acquisition will bolster IG’s trading and investment services in the UK by leveraging Freetrade’s innovative platform, which offers access to over 6,200 global stocks, ETFs, fractional shares, and other financial products. With a user-friendly interface and transparent pricing, Freetrade has established itself as one of the fastest-growing platforms in the UK, boasting 720,000 customers and £2.5 billion in assets under administration (AUA) as of 2024.

Breon Corcoran, CEO of IG Group, highlighted the importance of the acquisition:

“This is a rare opportunity to strengthen IG’s UK trading and investments offering and broaden our target addressable market. Freetrade’s strong brand, scalable technology, and rapid growth align perfectly with IG’s strategic goals.”

Freetrade Performance and Market Position

Freetrade’s performance has been impressive, with revenue growth of 32% in 2024, reaching £27.5 million, and achieving positive EBITDA for the first time. The platform’s strong customer retention and ability to attract high-value clients have contributed to its growth momentum.

Under IG’s ownership, Freetrade will operate as a standalone business with its existing brand and management team, led by co-founder and CEO Viktor Nebehaj. IG plans to invest in expanding Freetrade’s product offerings, enhancing its technology, and increasing marketing efforts to accelerate its growth.

Nebehaj expressed his enthusiasm for the acquisition:

“This is an exciting opportunity to accelerate our growth and delivery of new products and features on our award-winning platform. IG’s vision for Freetrade closely aligns with our own, and its backing will be invaluable as we scale the business.”

Plans for Freetrade Under IG’s Ownership

The acquisition will be funded entirely in cash from IG’s existing capital resources. IG reported a surplus regulatory capital of £638 million as of May 2024, ensuring a strong financial position post-transaction. The acquisition is expected to deliver a return on invested capital exceeding IG’s weighted average cost of capital within three to five years.

Analysts have noted the acquisition as a strategic use of IG’s resources. While not immediately transformative for IG’s balance sheet, the deal positions the Group to capitalize on the growing popularity of self-directed investing in the UK market, which is projected to expand at a compound annual growth rate of 10%.

This acquisition marks a key milestone for IG Group as it expands its reach into the direct-to-customer investment market. By combining Freetrade’s scalable technology and rapid customer acquisition capabilities with IG’s resources and expertise, the Group aims to capture a larger share of the UK’s evolving financial landscape.