Good morning,

Magellan Financial Group’s full-year results offered a sneak peek into the performance of FinClear Holdings. But accounts filed with the corporate regulator this week show the full extent of the damage.

The equities clearing house swung to a $16.9 million after-tax loss in FY23 from a profit of $39 million the year prior. The FY22 profit included a $49.2 million gain from the Pershing acquisition. Excluding this, the company recorded another unprofitable year.

FinClear has $62.5 million in the bank and last year had cash outflows of roughly $20 million. That will keep it going for a while but if things don’t start to look up, it raises questions about whether it will need to tap shareholders – including Magellan and venture capital outfit King River Capital.

Magellan marked down its 16 per cent stake in FinClear by 11.5 per cent to $25.7 million (carrying value) in its latest annual report, but said it remains a “supportive shareholder”.

Naturally, FinClear would argue it’s weathered a veritable drought in trading volumes. It would also highlight its FCX investment – a distributed ledger system that will be used to create a liquid market for private investors – which should eventually make it some money.

Magellan said as much in its annual report, noting that FinClear’s public equity markets business had been “impacted by weaker market conditions” and that it was “continuing to invest in growth opportunities”.

Happy reading,

• Luminis Partners, Arnold Bloch Leibler suit up for Endeavour board shake-up
• De Grey Mining pressed play on its mooted $300 million equity raising on Thursday morning and released its feasibility study
• JPMorgan has put the finishing touches on Mineral Resources′ $1.3 billion high-yield bond deal
• Recycling infrastructure business CDSA rattles the tin
• Melbourne-based fund manager Datt Capital has kicked off a raise for its freshly minted Small Companies fund

• Regal has walked away from its potential acquisition of Pacific Current, writes Jonathan Shapiro.
• Fireblocks, the crypto company backed by Sequoia Capital and Coatue Management, has acquired BlockFold, a Melbourne-based startup, Bloomberg News reports.
• Hurdles are multiplying fast for China Evergrande, the world’s most debt-saddled real estate developer, The New York Times reports.

De Grey Mining’s $300 million equity raising was priced at $1.05 a share, a tight 5.8 per cent discount to the $1.115 last traded price.

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