All options in play as MF Global seeks sale: source

By Jonathan Spicer

MF Global

A number of interested parties were considering several possible deals, including buying all or parts of the troubled U.S. futures brokerage run by former Goldman executive Jon Corzine, said the source, who requested anonymity.

"The goal is squarely for some sort of M&A transaction," the source said, adding the situation was "fluid".

The pressure is on the company after a week in which it posted a quarterly loss, its shares fell by two-thirds and its credit ratings were cut to junk. MF Global hired Evercore to help find a buyer, separate sources said this past week.

It was unclear how close the company was to a possible deal as discussions stretched through the weekend. MF Global declined to comment.

Since Corzine became chief executive last year, the brokerage has increasingly used its own capital to trade.

MF Global's problems are now rooted in low interest rates and bets made on European sovereign debt, and it is emerging as one of the hardest-hit U.S. financial firms in the fallout from Europe's economic crisis.

The company has reached out to banks including Barclays Plc, Citigroup Inc, Deutsche Bank, Jefferies Group Inc, JPMorgan Chase & Co, Macquarie Group Ltd, State Street Corp and Wells Fargo, a source familiar with the situation said on Friday.

The plunge last week in MF Global's corporate bonds to distressed levels, and in its shares to below $1 at one point on Friday, makes it all the more urgent for the company to come up with some sort of solution before markets open on Monday.

The company, which runs a Futures Commission Merchant and a broker-dealer, was scrambling last week to reassure customers about its stability as signs grew that some of them were withdrawing money.

A drop in a broker's credit rating to junk erodes confidence in its creditworthiness and can then restrict its ability to borrow -- the bedrock of any financial institution -- and fund day-to-day operations.

Corzine took the reins at MF Global after a term as governor of New Jersey.

(Additional reporting by Paritosh Bansal; Editing by Dale Hudson)