Today’s announcement that two prominent London stockbrokers, Panmure Gordon and Liberum, intend to merge comes as little surprise for a sector undergoing considerable consolidation in recent years.
The announcement comes 10 months after stockbrokers finnCap and Cenkos Securities combined forces, and nine months after Numis Corporation PLC (AIM:NUM) agreed to be bought out by Deutsche Bank for £410 million.
Yet the circumstances of the merger are anything but run-of-the-mill.
Panmure Gordon, the 147-year-old City stockbroker owned by controversial former Barclays PLC (LSE:BARC) boss Bob ‘Diamond Bob’ Diamond’s Atlas Merchant Capital group, will combine with mid-cap broker Liberum in an all-share deal to create Panmure Liberum.
The combined entity will be spearheaded by Panmure Gordon’s current chief executive Rich Ricchi, who some will recall as Diamond’s lieutenant at Barclays in the early 2010s.
Shane Le Prevost, founder and executive director at Liberum, will take the role of non-executive chair.
Some may also recall that both Diamond Bob and Rich Ricci departed Barclays in the wake of the Libor rigging scandal that saw the bank pay out £290 million in fines.
Ricci also coordinated Barclays’ acquisition of the Lehman Brothers, which gave Barclays a lucrative Wall Street footing for a bargain price of US$250mln (a fraction of the US$4bn Diamond was willing to pay before Lehman’s collapse).
Though Diamond remained active in the city post-Barclays, it was his joint takeover of Panmure Gordon alongside Qatari money in 2017 that brought him back into the spotlight.
With Diamond’s subsequent roping in of Ricci in 2020 to lead the firm (creating a Barclays-lite, as Proactive described it), Panmure Gordon was gearing up to make a big statement in the City of London.
Panmure Gordon pursued this manifesto when it approached small-cap broker finnCap with a takeover bid in October 2022.
That deal never went through, with finnCap instead merging with fellow small-cap mainstay Cenkos Securities in March 2023.
But with Panmure’s merger with Liberum, the ex-Barclays big swingers are poised to extend their City influence nonetheless, though the deal remains subject to regulatory approvals from the Financial Conduct Authority (FCA).
One wonders if the regulators will mull over Panmure Gordon’s largest shareholder, the Qatari-owned investment bank QInvest.
QInvest (which is owned by the stated-owned Qatar Islamic Bank) bought a 44% stake in Panmure Gordon in 2009, after which QInvest’s then-chief executive Tamim Al-Kawari was given a spot on Panmure’s board in 2013 to bring “extensive Middle East knowledge and investment banking experience” to the group.
Tamim Al-Kawari moved on from the Panmure Gordon board in 2018 before leaving QInvest in 2021 to head up the Qatar Stock Exchange.
According to Companies House, QInvest no longer has a seat on Panmure Gordon’s board, but it remains the number-one shareholder.
Middle Eastern royal family-owned British institutions are certainly nothing out of the ordinary in a globalised economy, but the hoopla surrounding the UAE-backed takeover of The Telegraph showed that it can be controversial nonetheless.
One thing is for certain- Panmure Liberum will be a major force in the City upon combination, with more than 250 quoted corporate clients and the largest deal volume for UK mid-cap IPOs in the past five years.