GPS Capital Markets For Sale, Sources Say

Corporate foreign exchange brokerage GPS Capital Markets is reportedly up for sale, unnamed sources told PE Hub.

The publication reported Thursday (Aug. 8) that three unnamed sources revealed Citi is advising on the process as GPS, which provides foreign exchange services to mitigate FX risk for corporate clients, seeks a buyer. As of last year, the company employed 63 people, reports said, citing Utah Business data.

GPS Capital Markets, founded by Al Manbeian and Ryan Gibbon, posts between $20 million and $30 million earnings before interest, taxes, depreciation and amortization (EBITDA), one source told the publication.

PE Hub noted that among GPS Capital Markets’ direct competitors is Cambridge Global Payments, another foreign exchange management and cross-border B2B payments company that was acquired by FLEETCOR in 2017 for about $690 million.

“We have followed the international payments market for several years and are excited to announce the acquisition of a global leader in the industry,” said Ron Clarke, chairman and chief executive officer of FLEETCOR, in a statement at the time. “We like the strategic fit with Cambridge as they focus on international AP payments while FleetCor, via Comdata, focuses on domestic AP payments.”

Analysts are urging corporate treasurers to elevate their foreign exchange management and risk exposures amid a period of increasing market volatility.

Earlier this year Laurent Descout, CEO and founder of corporate cash management FinTech Neo, told PYMNTS about the growing risk of FX volatility.

“On one hand, many corporates just decide not to engage in some international operations given such a risk,” he said, noting that he has often seen FX management struggles becoming a total barrier to going international. “This is especially true for SMEs who cannot run the risk of losing 30 percent of revenue on a currency depreciation.”

Recent analysis from Kyriba revealed that U.S. corporates lost a combined $23.39 billion related to FX volatility in the first quarter of 2019.