The IG Group Underdog acquisition dominated broker news this week, with the London-listed trading group agreeing to pay up to approximately $1.3 billion for US prediction markets and fantasy sports platform Underdog. The deal reshapes IG’s long-term strategy and handed shareholders a sharp lesson in how markets read bold acquisitions.
What the IG Group Underdog Acquisition Means for Holders
The transaction is structured as roughly $1.1 billion in upfront consideration plus an earnout of up to $200 million, the latter conditional on Underdog hitting a positive EBITDA in 2026 and tied to its net gaming revenue for that year. According to IG Group’s RNS announcement, the upfront price represents 2.4 times Underdog’s net revenue for the 12 months to 30 June 2026.
IG expects the deal to more than double its US revenue and grow monthly active customers by more than tenfold. Underdog will operate as a standalone brand, with co-founder and chief executive Jeremy Levine reporting directly to IG CEO Breon Corcoran. Completion depends on US regulatory approvals, including clearance or expiry of the waiting period under the Hart-Scott-Rodino Act.
Corcoran framed the rationale in unambiguous terms. Reuters quoted him saying: ‘The acquisition of Underdog establishes IG as a leader in U.S. prediction markets, one of the most significant opportunities across trading and entertainment, and accelerates our growth in the world’s largest and fastest-growing retail trading market.’
IG published the deal alongside its half-year results on 30 July 2026. Revenue rose 18% to £642.8 million and adjusted earnings per share climbed 21% to 68.9p, yet the EBITDA margin (earnings before interest, tax, depreciation and amortisation, as a proportion of revenue) narrowed to 43.9% from 49.6%. The market’s verdict was swift: European Gaming reported IG shares fell approximately 11% to around 1,522p the following morning, from a prior close of 1,706p. Investors holding IG stock saw that move in real time.
The IG Group Underdog acquisition also forms part of a broader strategic reset. IG is pursuing a proposed redomicile and has scheduled a strategy update for 22 October 2026, at which it will present a refreshed capital allocation framework. Completion of the Underdog deal itself is expected in late 2026 or early 2027.
XTB’s Revenue Paradox and Squared Financial’s Withdrawal Problems
XTB’s results this week illustrated a structural tension building inside the broker. During the first half of 2026, shares, ETFs and Investment Plans accounted for nearly 83% of opening transactions by new European clients. Yet CFDs (contracts for difference, which pay the price movement of an asset without requiring ownership) still generated about 96% of gross income from financial instruments, with commodity CFDs responsible for more than three-quarters of that total.
The commodity tilt was even more pronounced in Q1 2026. FX News Group reported that commodity-based CFDs accounted for 88.5% of gross revenues from financial instruments in that quarter, driven by gold, silver, crude oil and platinum, up from 29.1% in Q1 2025. The XTB Q1 2026 results presentation showed total operating income of PLN 1,094 million, up 88.5% year-on-year, and net profit of PLN 535 million, up 195.7%. The broker is attracting long-term investors while its earnings engine runs almost entirely on short-term trading.
Elsewhere, Squared Financial appeared to have shut down its Seychelles-based offshore operation roughly six months after surrendering its Cyprus licence. Finance Magnates found that new clients could no longer open accounts through the website, while online reviews cited delayed withdrawals and difficulties reaching customer support. Trustpilot said it had removed fake reviews from the firm’s profile. Former Nigeria Managing Director Temitope Ijibadejo publicly raised concerns over pending client withdrawals and called for a local investigation.
On the topic of Cyprus, FM Intelligence modelling found that brokers may need around €3 million in annual pre-tax profit before Cyprus’s 15% corporate tax rate (raised at the start of 2026) saves enough to offset the higher operating costs of basing there versus Poland, which benefits from lower labour costs and a growing domestic investor base.
BlackBull’s New Zealand filing showed domestic revenue rising to more than NZ$41 million and client funds climbing nearly 87% to almost NZ$100 million, though profit fell as costs rose. The fuller picture came from its IPO roadshow: according to TradingView/Finance Magnates, co-founders presented group-wide preliminary figures of NZ$108 million in revenue, NZ$55 million in EBITDA and NZ$38 million in net profit to fund managers in Sydney, with EBITDA margins above 50%.
LMAX Group is reportedly weighing options that could value it at up to $5 billion, a fivefold increase from its estimated $1 billion valuation in 2021, with a Nasdaq listing the preferred route. Morgan Stanley and KBW are said to be advising. Its latest public accounts cover 2024, so investors considering any future listing will be working with dated earnings data until new figures emerge. The strategy update IG has set for 22 October 2026 is the next concrete date on the calendar for one of this week’s main storylines.
