TERRY SMITH, the combative chief executive of Tullett Prebon, the inter-dealer broker, will this week step up his battle to wrest control of Espeed, an electronic trading business, from arch-rival Cantor Fitzgerald.

Smith has written to minority shareholders in Espeed calling for them to support Tullet’s $600m (£300m) takeover offer for the American company.

The move comes after Cantor, which controls Espeed, rebuffed Tullett’s offer last week.

In the letter, Smith also raises concerns about a “reverse repurchase agreement”, in effect a loan from Espeed to Cantor that is estimated at about $180m.

As a condition of its takeover offer, Tullet sought assurances that the agreement could be cancelled and the money recovered since it would have a material impact on the value of Espeed.

It is also critical of the level of charges under a joint service agreement where Cantor is paid fees by Espeed to clear trades.Cantor said the repurchase deal was an inter-company arrangement, but declined to comment further.

Although the majority of Espeed’s shares were floated in 1999 on Nasdaq, Cantor holds 88% of the voting rights.

The battle comes at a sensitive time for Cantor, which is preparing to float BGC, its money-

broking business, for about $1 billion in New York.

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