MF Holdings Ltd.

MF Global is basically a sophisticated international financial transaction company. Evaluation of the market cap and the per-share value of the stock is the subject of a questionable guessing game.

Historically the company was a subsidiary of the giant London-based Mann Group which at some stage was considered the largest hedge fund company in the world. The so-called transaction company which was MF Global Ltd., was domiciled in Bermuda and was spun off from Mann Group about two years ago. Subsequently, the headquarters was transferred to New York City and the result was a diversified custom-based finance company. The description of Global by product, services, markets and clientele is best described by a diagram which we illustrate in the table below.

The analytical evaluation of the basic business, as illustrated above, are the numbers we present for the fiscal periods.

Qualitatively the company claims that its business is client driven. It has a leading market position in 13 countries and 70 stock markets. It has a singular access to and liquidity in the wide range of products and in the geographic markets mentioned above. MF claims that it provides a clear transaction-oriented market activity and leading research in the products and the geographic positions in which it functions.

The company is basically trading in derivatives, foreign currencies, and various finance instruments. In many respects, the activities of MF Global, following the tremendous growth in international commodity trading which has taken place in the last five to ten years. Commodity brokerage, of course, is much larger in numbers than finance instruments. Comparison between the shares outstanding and the market cap between MF Global and the New York Mercantile Exchange.

The New York Mercantile Exchange (NYMEX) is the world's largest physical commodity futures exchange, located in New York City. Its two principal divisions are the New York Mercantile Exchange and Commodity Exchange, Inc (COMEX) which were once separate but are now merged. The parent company of the New York Mercantile Exchange, Inc., NYMEX Holdings, Inc. became listed on the New York Stock Exchange on November 17, 2006, under the ticker symbol NMX.

The New York Mercantile Exchange handles billions of dollars worth of energy products, metals, and other commodities being bought and sold on the trading floor and the overnight electronic trading computer systems. The prices quoted for transactions on the exchange are the basis for prices that people pay for various commodities throughout the world.

The future attraction of MF Global is based on the following hypotheses:

The recent changes

In late March, 2010, there was a dramatic change in the corporate history and future of MF Global. The former chairman of Goldman Sachs, who recently terminated his position as Governor of New Jersey, became chairman and a large stockholder of MF Global. See announcement.

A former associate of Goldman Sachs, Mr. John Corzine is 15% owner of MF Global. His private equity firm, J.C. Flowers and Co., is in financial services. It was funded in 2001. Christopher Flowers was a former partner and close associate of John Corzine. J.C. Flowers manages two private equity funds, the J.C. Flowers ILP, which was closed in 2002 with $900 million committed capital, and J.C. Flowers Two LLP closed in 2006 with $7 billion in committed capital. The basic business of the company includes large investments in financial services companies, a sample illustrated in the following tables.

Upon information and belief, we understand that one of the key factors J.C. Flowers employs is putting or inviting leading industry experts into the companies they acquired and build the companies with modern techniques and imaginative financing.

J.C. Flowers is not a traditional private equity fund and has pulled back from the purchase of large companies such as the leading British mortgage bank, Northern Rock, for $5 billion, and actually at some stage was bidding for the now merged Bear Stearns.

The approach of combining the activities of Governor John Corzine in MF Global and J.C. Flowers & Co. is going to be decisive for MF's future.

The Emerging Macro Economic Picture

It is obvious that with the emergence of what I call the old Goldman Sachs due and their potential contacts, it could have a multi-constructive effect on the future of MF Global.

MF Global is in transition. Like many other medium-sized firms, it had two choices, either to be merged into another company and disappear, or strengthen its balance sheet, strengthen its management and expand its vision.

MF Global acquired the necessary talent, contacts financial backing, by having Governor Corzine and a potential team join the company and hopefully utilize J.C. Flowers & Co.'s contacts and financial backing for further growth. The interesting point is that the possibilities are very great for this medium-sized company whose market cap today is only about a billion dollars. The business is available, the capital is available, the contacts are available, and the basic business serves the purpose in the international field.

This is possible because of the time we live in. First of all, we live in an international world. Second, we live in a world where capital and contacts and experience counts. Three, we live in a world where product lines, markets, businesses can be expanded on a phenomenal scale. The emergence of China, Brazil, Singapore, Dubai, and Saudi Arabia is creating opportunities as well as challenges for the financial participants of our time. If we simply quote the names, Governor Corzine, the former chairman of Goldman Sachs, Christopher Flowers, a former partner of Goldman Sachs, the various financial companies partially or fully owned by J.C. Flowers, which we list in an appendix.

The original base that 70 stock markets in certain countries represented today, when brought together with a new group of players, the possibility emerges that we are seeing today a new company, MF Global, which could be a leading player in foreign exchange transactions, in interest rate products, in international bonds, marketing and underwriting. Nevertheless, while the scope in the future cannot be analyzed except forecast, it is our considered opinion that a new company would emerge that over the years will make a major contribution to the financial transactions of the world we are going to live in.