Commoditrade acquires LME Cat 1 rights, discloses MF Global shareholding

In its interim results statement for the six-month period to June 30, 2007, Commoditrade Inc. announced it had acquired sufficient shares in the London Metal Exchange to bring its total holdings to 25,000 B shares. This entitled the company to apply for a Category 1 membership of the LME, it said, though it had “no current plans” to do so, a spokesman told news agencies. AIM-listed Commoditrade also said it had renegotiated its contract with Sucden (UK) Limited, where it earns a fixed percentage of the profits on Sucden's ring dealing activities. Previously Commoditrade received 75 per cent of those profits in return for payment of an amount equal to 25 per cent of Sucden's profits. In future, the annual fee payable to Sucden had now been fixed at £7.5m. Commoditrade has also secured the services of the key members of the trading team for a minimum period of three years, it said. These traders have been further incentivised through granting of options in Commoditrade, which will vest over a three year period. After direct trading costs and trader bonuses, net trading profit for the first half of 2007 was £10.4 million. After deduction of non-cash items, being amortisation of £5.6 million and costs associated with the issue of share options to the trading team of £1.4 million, and corporate overhead costs, the profit before tax for the period was £3.5 million. In a separate update this week, it disclosed a holding of 7.79 per cent of the issued share capital of Commoditrade by MF Global UK Limited, a current Category 1 member of the LME