 Creates a Leading Global Provider of Consulting and Trade Execution Services Filed by FCStone Group, Inc.. pursuant to Rule 425 of the Securities Act of 1933 Subject Company: International Assets Holding Corporation Commission File No.: 000-23554 |
 1 Cautionary Statement and Additional Information The following presentation should be taken in conjunction with the most recent financial statements and
notes thereto as well as the most recent Form 10-Q filed with the SEC. This presentation may
contain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements involve known and
unknown risks and uncertainties, many of which are beyond our control, including adverse changes
in economic, political and market conditions, losses from market-making and trading activities arising from counter-party failures and changes in market conditions, the possible loss of key personnel, the impact
of increasing competition, the impact of changes in government regulation, the possibility of
liabilities arising from violations of federal and state securities laws and the impact of changes in technology in the securities, foreign exchange and commodities dealing and trading industries. Although we believe that
the forward-looking statements are based upon reasonable assumptions regarding our business
and future market conditions, there can be no assurances that actual results will not differ materially from any results expressed or implied by the forward-looking statements. We undertake no obligation to
publicly update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise. Readers are cautioned that any forward-looking statements are not guarantees of future performance. This presentation is being made in respect of the proposed business combination involving International
Assets and FCStone. In connection with the proposed transaction, International Assets
intends to file with the SEC a registration statement on Form S-4, containing a joint proxy statement/prospectus and other relevant materials and each of International Assets and FCStone plan to file with the SEC other documents
regarding the proposed transaction. The final joint proxy statement/prospectus will be
mailed to the stockholders of International Assets and FCStone. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE JOINT PROXY STATEMENT/PROSPECTUS (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS) AND OTHER DOCUMENTS
FILED WITH THE SEC CAREFULLY IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION ABOUT INTERNATIONAL ASSETS, FCSTONE AND THE PROPOSED
TRANSACTION. Investors and security holders will be able to obtain free copies of the
registration statement and the joint proxy statement/prospectus (when available) and other
documents filed with the SEC by International Assets and FCStone at the SEC’s web site at www.sec.gov. Free copies of the registration statement and the joint proxy statement/prospectus (when available) and other documents filed with the SEC can also be
obtained by directing a request to International Assets at: 220 East Central Parkway,
Suite 2060, Altamonte Springs, Florida 32701, Attention: Scott Branch, telephone: 888-345-4685 x335; or to FCStone at: Investor Relations Department, FCStone Group, Inc., 1251 NW Briarcliff Parkway, Suite 800, Kansas City,
Missouri 64116; Attention: William Dunaway; Telephone: (816) 410-7129. In addition,
investors and security holders may access copies of the documents filed with the SEC by International Assets on International Assets’ website at www.intlassets.com, and investors and security holders may access
copies of the documents filed with the SEC by FCStone’s website at www.fcstone.com.
International Assets, FCStone and their respective directors and executive officers and other
persons may be deemed to be participants in the solicitation of proxies from the stockholders
of International Assets and FCStone in respect of the proposed transaction. Information regarding International Assets’ directors and executive officers is available in its annual report on Form 10-K for the year ended September 31,
2008, filed with the SEC on December 8, 2008 and the proxy statement for International
Assets’ 2009 annual meeting of stockholders, filed with the SEC on January 15, 2009. Information regarding FCStone’s directors and executive officers is available in its annual report on Form 10-K for the year ended
August 31, 2008, filed with the SEC on November 14, 2008 and the proxy statement for
FCStone’ 2009 annual meeting of stockholders, filed with the SEC on December 8, 2009. If and to the extent that any of the International Assets or FCStone participants will receive any additional benefits in connection with the
merger that are unknown as of the date of this filing, the details of those benefits will be
described in the definitive joint proxy statement/prospectus relating to the merger. Investors and stockholders can obtain more detailed information regarding the direct and indirect interests of International Assets’ and
FCStone’s directors and executive officers in the merger by reading the definitive joint
proxy statement/prospectus when it becomes available. |
 2 th Transaction Highlights Transaction International Assets Holding Corp. (“INTL”) and FCStone Group, Inc.
(“FCSX”) merge to create a leading global provider of consulting
and trade execution services INTL and FCSX shareholders will own 52.5% / 47.5%, respectively FCStone will retain its name and operate as a division of INTL Consideration 100% stock FCSX shareholders will receive 0.2950x common INTL shares for each outstanding common share of FCSX Expected Close Transaction is expected to close in 4 calendar quarter 2009 Approvals Shareholders of both INTL and FCSX Regulators Board & Management 7 INTL directors, 6 FCSX directors Pete Anderson will be President and will join the INTL board, along with 5 other
FCSX board members |
 3 The 3 Keys to the Transaction Integrating exchange-based, OTC and physical trading platforms and expertise in hard and soft commodities… Creates global, full-service provider to commodities market participants Combining two capital structures… Accelerates growth strategies, enhances access to credit Positioning for a new financial services landscape… Strengthens capital base, diversifies earnings, mitigates risk Current environment provides a significant opportunity for a credible, well capitalized entity to gain market share |
 4 Global Leader in Specialized Markets Leading OTC trader and hedger of physical metals Significant player in hedging of agricultural, energy and soft commodities Leading provider of treasury services and foreign exchange services Leading market maker in foreign equities Provider of competitive execution to over 10,000 wholesale customers in North America and globally ~74 million commodity contracts traded (a) Physical commodities revenues of ~$40bn (b) Trades 8,000 unlisted ADR’s in over 20 countries and more than 100 currencies International offices in Brazil, Argentina, London, Ireland, Dubai, Singapore, Australia and China Commodities Trading International Equities Market Making Commodity and Risk Management Services Clearing & Execution Services International Debt Capital Markets Asset Management Foreign Exchange (a) For the twelve month period ended May 31, 2009. (b) For the twelve month period ended March 31, 2009. |
 5 Strategic Fit OTC Market Making High Touch Complex Markets International Markets Disciplined Risk / Capital Mgt. Hard Commodities, FX, Equities Domestic Markets Risk Management Consulting Exchange Traded Platform Agricultural, Energy & Soft Commodities Proven Sales and Marketing Providing strategic recommendations and value added execution capabilities Complete trading solution for customer Complementary product expertise Greater growth potential through geographic diversification Complementary management skills |
 6 FCStone INTL INTL Business Activity Complementary International Footprint • Relationships in over 100 Countries • Offices in 28 Cities • Locations in 11 Countries Combined International Presence: |
 7 Structured for New Financial Services Landscape Current environment is one of reduced access to and a higher cost of capital FCSX has a $75 million margin facility and $40 million of bank sub-debt outstanding,
which matures July 22, 2010 and will be repaid with the proceeds from income tax refunds totaling approximately $54.0 million in the next nine months IAAC renewed its secured metals financing facility (new maturity June 27, 2010) with $62 million of availability and extended the maturity of $60 million in other debt from December 31, 2009 to December 31, 2010 Debt capital availability will be at a premium for the foreseeable future Customers, counterparties, investors will increasingly value strong risk management, access to capital, diversity of earnings streams Regulatory capital requirements likely to increase across financial services
markets Diversified platform better able to absorb rapid changes in the
overall marketplace |
 8 Strategic Growth Plan Apply disciplined capital allocation approach by protecting and compounding capital Offer value added services to build durable revenue streams and create franchise value over time Broaden and deepen customer relationships globally Focus on organic growth and opportunistic add-on acquisitions
|
 9 Contribution Analysis ($ in millions) % Ownership INTL FCSX Adjusted EBITDA YTD 2009 Annualized MRQ Annualized 2009 Projected 2010 Projected Adjusted Net Income YTD 2009 Annualized MRQ Annualized 2009 Projected 2010 Projected Market Cap Book Value Source: Company Filings. Note: LTM, YTD and MRQ as of 3/31/09 for INTL. LTM, YTD and MRQ as of 5/31/09 for FCSX. Financial information excludes one-time charges. The above values represent the implied equity value
percentage contribution of INTL and FCSX. Contribution analysis calculated
using INTL adjusted marked-to-market financial information. Market data as of 6/30/09. 57% 89% 59% 57% 43% 11% 41% 43% 54% 91% 56% 57% 46% 9% 44% 43% 55% 34% 45% 66% |
 10 Overview |
 11 FCSX – Customer Oriented Business Model Customers / Industries Served Agriculture Fuel Surcharge Carbon Credits Energy Livestock Introducing Brokers Renewable Fuels Food Products Weather Forest Products Customers Floor Traders Professional Traders Introducing Brokers OTC Market Physical Market Merchant Services (Commodity financing program) Exchange–Traded Market Risk Management Consultants Provides Access to Provides Access to Clearing & Execution Commodity & Risk Management |
 12 Serves risk management needs of middle-market intermediaries, end-users and producers of commodities Employs proprietary Integrated Risk Management Program (“IRMP”) to design customized risk management strategies High-touch, value-add services delivered through 125 consultants High margin business Half of total company revenue but 75% of profits $53 $81 $128 $177 $87 0 50 100 150 $200 FY2005 FY2006 FY2007 FY2008 Q3'09 Annualized 426 460 500 529 523 0 100 200 300 400 500 600 FY2005 FY2006 FY2007 FY2008 Q3'09 FCSX – CRM Business Total Revenues ($ in millions) IRMP Accounts |
 13 Why Do Customers Come to FCStone? EXECUTION Performance INDUSTRY INTELLIGENCE STRATEGIC PLAN GATHER & ANALYZE DATA Planning GOALS OBJECTIVES PERIODIC AND ANNUAL REVIEWS Accountability Integrated Risk Management Program (IRMP) • We improve customers’ bottom-line results • Strong brand, proprietary tool sets and outstanding clientele • Unique, holistic service – not just trading and hedging • Specialized, experienced consultants |
 14 Clearing and execution of derivatives for institutional and professional traders
Serves approximately 9,000 customers as an independent FCM Clearing member of all North American exchanges with access to all major international
exchanges Primary focus on supporting C&RM customer trading
programs Offers economies of scale Disciplined approach Emphasizing shorter-tenored accounts and moving away from large third-party accounts Declining volume is a function of exited business as well as market conditions
$53 $80 $102 $147 $88 0 50 100 150 $200 FY2005 FY2006 FY2007 FY2008 Q3'09 Annualized FCSX – CES Business Total Revenues ($ in millions) |
 15 1,752 2,506 3,121 3,543 3,148 3,213 2,369 2,697 1,361 835 1,904 2,832 3,872 4,904 3,983 4,242 2,775 3,022 751 326 152 406 1029 325 0 1,000 2,000 3,000 4,000 5,000 6,000 FY2005 FY2006 FY2007 FY2008 LTM Q3'09 Q1'09 Annualized Q2'09 Annualized Q3'09 Annualized OTC Exchange-Traded Source: FCSX management. FCSX – Historical Volume Commodity & Risk Management Exchange-Traded and OTC Contract Volume (000s) Clearing & Execution Exchange-Traded
Contract Volume (000s) 34,488 44,961 57,868 95,068 82,382 82,121 62,715 52,241 0 25,000 50,000 75,000 100,000 FY2005 FY2006 FY2007 FY2008 LTM Q209 Q1'09 Annualized Q2'09 Annualized Q3'09 Annualized |
 16 $91 $83 $88 $86 $54 $42 $9 $10 $4 $12 $17 $3 0 20 40 60 80 $100 2/29/08 5/31/08 8/31/08 11/30/08 2/28/09 5/31/09 0 4 8 12 16 $20 Total Revenue Net Interest Income Source: FCSX management. (a) Total revenue, net of cost of commodities sold. (b) Excludes one-time items. FCSX – Financial Performance Total Revenue (a) and Net Interest Income (b) ($ in millions) Adjusted EBITDA (b) ($ in millions) Total Contract Volume (Contracts in thousands) Customer Segregated
Assets ($ in millions) $26 $20 $21 $17 $5 $2 24% 24% 9% 20% 28% 3% 0 5 10 15 20 25 $30 2/29/08 5/31/08 8/31/08 11/30/08 2/28/09 5/31/09 0 10 20 30 40 50 60% Adjusted EBITDA Adjusted EBITDA Margin 839 1,118 1,084 1,528 862 914 0 250 500 750 1,000 1,250 1,500 $1,750 2/29/08 5/31/08 8/31/08 11/30/08 2/28/09 5/31/09 27,191 26,597 21,545 21,333 16,291 13,735 370 294 396 257 101 81 13,816 16,392 21,591 21,941 26,892 27,561 10,000 14,000 18,000 22,000 26,000 30,000 2/29/08 5/31/08 8/31/08 11/30/08 2/28/09 5/31/09 Exchange-Traded OTC |
 17 Commercial Grain Leverage Commodity price declines Less volatility Relief in pricing pressure CoBank easing New buyers enter industry Retrofitting opportunity Increasing level of hedging need Technology licensing Bankruptcies Rising credit costs Lack of new development Renewable Fuels Market opportunity vs. market share Growing account base Increasing level of hedging need Impact of credit crunch Latin America / International Ability to bring on new IB’s to C&ES business Increase in farmer business Acquisitions Weakening competitors (C&ES) Rising credit costs (C&RM) Introducing Brokers Increasing level of hedging need Value chain: (producers, processors, restaurants) Educational process Food Services Vertical: Forest products, carbon, etc. Geographic: Europe, Asia & Australia Investment capital New Markets FCSX – Business Outlook Market/Product Segment Near-Term Headwinds Intermediate / Long – Term Opportunity |
 18 Selected Risk Mitigating Processes Establish position and product limits based on credit capacity and business performance Risk Consultants are primarily financially responsible for all debits and errors Utilize insurance and credit default swaps on trading counterparties Requiring that margin calls are met in a timely fashion; introduced intra-day margining for largest customers Primarily hedging strategies Risk consultants have close relationships Business maintain physical inventories to support positions Credit facilities exist to mitigate any potential losses with a majority of these on a tri-partite basis Primarily proprietary groups Carefully screening of all prospective clients Focus on speculative strategies Limited capital protection outside trading accounts Client relationships may not be as robust Selected Risk Mitigating Processes Establish adequate margin, oversight and enforcement “Stress testing” of open positions Marking positions to market daily Requiring that margin calls are met in a timely fashion; introduced intra-day margining for largest customers Establish limits based on credit capacity and overall volumes Clearing & Execution Customers Commodity & Risk Management Customers FCSX – Risk Management Fundamentals |
 19 Overview |
 20 INTL – Overview Our Company Fortune 500 Company - Ranked #16 in ten year profit growth and #12 for returns to shareholders Five business units – commodities trading, foreign exchange, international equities market making, international debt capital markets and asset management Over 190 professionals located in New York, London, Dubai, Singapore, Buenos Aires,
Orlando, and Miami Executive management has invested significant capital and currently owns 27% of the
Company Leucadia (NYSE – “LUK”) is the largest institutional shareholder with 16% ownership Our Track Record Over the last 5 years revenues increased over 30X, equity capital increased 15X
Adjusted operating revenue has grown at a 46% CAGR since 2004 Adjusted stockholders’ equity has grown at a 33% CAGR since 2004 Adjusted net income has grown at a 62% CAGR since 2005 Note: Adjusted financials include mark-to-market adjustments as detailed in INTL public filings. |
 21 1 Experienced Professionals Over 190 professionals globally Management has over 50 years of combined experience in banking and credit exposure practices Multiple Expansion Opportunities Significant growth opportunities across all business segments Over last 5 years revenues increased over 30x, equity capital increased 15x Disciplined Risk Management Consistent growth in revenues and EBITDA over the last 5 years through disciplined risk management 5 6 7 4 INTL – Business Model Rapid Revenue Growth with Strong Operating Leverage Critical mass allows operational leverage to be achieved Diversified Global Footprint Offices in key international markets and relationships in over 100 countries High Quality Counterparties Well established, reputable institutional clients and NGOs Differentiated Focus on High Margin Niche Market Leading position in profitable niche markets through quality execution and client service Diversified Revenue Base International Equity Market-Making Commodities Trading Foreign Exchange International Debt Capital Markets Asset Management |
 22 INTL – Consistent Financial Performance $22.0 $26.1 $43.4 $77.0 $100.5 $117.0 0 25 50 75 100 $125 FY2004 FY2005 FY2006 FY2007 FY2008 YTD FY2009 Ann. ($0.1) $2.6 $8.2 $10.1 $11.0 $17.0 (5) 0 5 10 15 $20 FY2004 FY2005 FY2006 FY2007 FY2008 YTD FY2009 Ann. $24.6 $28.1 $38.7 $54.9 $77.3 $83.0 0 20 40 60 80 $100 FY2004 FY2005 FY2006 FY2007 FY2008 3/31/2009 $3.48 $3.78 $4.94 $6.65 $8.66 $9.19 0 2 4 6 8 $10 FY2004 FY2005 FY2006 FY2007 FY2008 3/31/2009 Adjusted Operating Revenue Adjusted Net Income Adjusted Stockholders’ Equity Adjusted Book Value Per Share Source: Public filings. Note: Adjusted financials include mark-to-market adjustments as detailed in INTL public filings. Adjusted Net asset value per share calculated as adjusted stockholders’ equity divided by book shares outstanding. |
 23 What We Do Provide efficient OTC execution in base and precious metals Physical delivery Forward transactions and future deliveries Options and hedging programs Allow producers and consumers to effectively manage their exposure and enhance profitability Why We Do It Wealth effect in Asia and Middle East driving precious metals demand Growth in global manufacturing, particularly in China, driving base metals demand Locations in important metals trading centers globally enable us to provide trading / hedging / risk management services to niche customers OTC Commodities Trading Assisting Commercial Players in Smaller Niche Markets 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 $10,000 Q1 2006 Q2 2006 Q3 2006 Q4 2006 Q1 2007 Q2 2007 Q3 2007 Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Adjusted Operating Revenues (Non-GAAP) Net income Source: International Monetary Fund, 2009, ‘Global Prospectus and Policies’, World
Economic Output; crisis and recovery, April, chapter 1, pg 45,
http://www.imf.org/external/pubs/ft/weo/2009/01/pdf/c1.pdf |
 24 What We Do Leading provider of exotic FX and treasury services covering 100+ countries Clients include over 400 NGOs, UN and bilateral aid agencies, OECD embassies worldwide, and corporations FXecute platform provides integrated web- based payments solution Why We Do It Emerging market currencies are one side of almost 20% of all transactions, compared to <15% in 2004 5-year growth of 157% in transactions between banks and non-financial customers Liberalization of emerging market currencies spurring need for expert trading support Our relationships in hard-to-reach markets allow us to capture very competitive rates OTC Foreign Exchange Trading Focusing on Less Liquid Exotic Markets Fxecute Statistics 0 20 40 60 80 100 120 140 160 180 200 0 200 400 600 800 1000 1200 1400 1600 Total Number of active clients Total Number of transactions 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 $9,000 Q1 2006 Q2 2006 Q3 2006 Q4 2006 Q1 2007 Q2 2007 Q3 2007 Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 - 2,000 4,000 6,000 8,000 10,000 12,000 Adjusted Operating Revenues (Non-GAAP) Net income Number of trades Source: International Monetary Fund, 2009, ‘Global Prospectus and Policies’, World
Economic Output (WEO); crisis and recovery, April, chapter 1, pg 16,
http://www.imf.org/external/pubs/ft/weo/2009/01/pdf/c1.pdf |
 25 What We Do OTC Market maker in over 1,000 international equities Also quote over 8,000 international equities Focus on unlisted ADRs and foreign ordinaries – household names like Nestle, L’Oreal, Sainsbury, Marks & Spencer, Nintendo, VW, Porsche, etc. Why We Do It U.S. investors want to diversify away from U.S. economy and dollar Many investors find direct investing via foreign exchanges to be difficult Our scale and market share attract customers seeking expertise in local market trading complexities Source: J.P Morgan, 2008, J.P. Morgan Depository Receipts – Connecting the
International Capital Markets; The Year in Review, pg 14, 7/8/2009,
<http://www.adrbnymellon.com/files/MS24388.pdf> 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 $20,000 Q1 2006 Q2 2006 Q3 2006 Q4 2006 Q1 2007 Q2 2007 Q3 2007 Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 - 50,000 100,000 150,000 200,000 250,000 300,000 Operating Revenues Net income Number of trades OTC Equities Market-Making Market Maker in Niche Markets – Unlisted ADRs |
 26 Fee Earning Businesses Investment Banking for Smaller Issuers and Leveraging Our Expertise For Investors
What We Do Originate, structure and place wide array of emerging market debt instruments One of largest arrangers of ABS in Latin America with a dominant position in Argentina Our specialist expertise in niche markets enables us to provide unique products to
institutional investors – focused on absolute return performance, low volatility and low correlation to the underlying markets Why We Do It Fee-based business provides an excellent source of diversification from other
trading/market-making businesses |
 27 We focus on dealing with commercial counterparties who are end-users of our financial
products and services – have very few hedge fund or speculative clients. We have over 1,800 clients INTL – Customers |
 28 Appendix |
 29 FCSX – Financial Reconciliation ($ millions) 2006 2007 2008 YTD Q3'09 Q3'09 Revenue (as reported) $1,294.8 $1,342.0 $337.5 $199.7 $57.5 Cost of commodities sold (1,112.9) (1,084.2) (1.1) (19.1) (16.0) Revenue, net of cost of commodities sold $181.9 $257.8 $336.5 $180.6 $41.5 Net Income from continuing ops (as reported) $15.3 $33.6 $47.4 ($61.1) ($8.1) Bad debt expense 0.0 0.0 0.0 116.9 5.1 Sentinel loss 0.0 5.6 0.0 0.0 0.0 Gain on sale of FGDI 0.0 (2.6) 0.0 0.0 0.0 Loss on FGDI contractual dispute 0.0 0.0 0.0 3.5 3.5 Dividend on CBOT stock 0.0 (0.5) 0.0 0.0 0.0 Gain on sale of exchange seats & stock 0.0 (3.7) (3.7) (6.5) 0.0 Gain / loss on interest rate contract 0.0 0.0 (0.0) 0.0 0.0 Pension charge 0.0 0.0 1.5 0.0 0.0 Clearing fee related to CRM business 0.0 (1.4) 1.4 0.0 0.0 Impairment of goodwill 0.0 0.0 0.0 1.9 0.0 Professional Fees 0.0 0.0 0.0 1.9 1.9 Executive compensation 0.0 0.0 0.0 4.7 1.9 Adjustments 0.0 (2.5) (0.9) 122.5 12.5 Income tax impact on extraordinary items 0.0 0.9 0.4 (49.7) (3.9) Adjusted Net Income from continuing ops $15.3 $32.0 $46.9 $11.7 $0.5 EBITDA (as reported) $32.1 $65.3 $86.0 ($95.8) ($9.9) Bad debt expense 0.0 0.0 0.0 116.9 5.1 Sentinel loss 0.0 5.6 0.0 0.0 0.0 Gain on sale of FGDI 0.0 (2.6) 0.0 0.0 0.0 Loss on FGDI contractual dispute 0.0 0.0 0.0 3.5 3.5 Dividend on CBOT stock 0.0 (0.5) 0.0 0.0 0.0 Gain on sale of exchange seats & stock 0.0 (3.7) (3.7) (6.5) 0.0 Gain / loss on interest rate contract 0.0 0.0 (0.0) 0.0 0.0 Pension charge 0.0 0.0 1.5 0.0 0.0 Clearing fee related to CRM business 0.0 (1.4) 1.4 0.0 0.0 Professional Fees 0.0 0.0 0.0 1.9 1.9 Executive compensation 0.0 0.0 0.0 4.7 1.9 Interest on short-term borrowings (5.2) (9.0) (4.9) (2.3) (0.4) Minority interest (0.2) 0.6 (0.1) (0.6) (0.3) Adjustments (5.4) (10.8) (6.0) 117.7 11.8 Adjusted EBITDA $26.7 $54.4 $80.0 $22.0 $1.9 |