MAGGIE PAGANO: The town loves a sly villain

If your name is Bob Diamond or Rich Ricci, there’s only one way – up the money tree.

The two former Barclays bosses, who now run British stockbroker Panmure Gordon, are doing just that with their latest move to merge with rival investment boutique FinnCap.

FinnCap, which is valued at around £30m even after its shares rose yesterday, could look relatively small.

New company: If your name is Bob Diamond (pictured) or Rich Ricci, there's only one way to climb the money tree — up and up

New company: If your name is Bob Diamond (pictured) or Rich Ricci, there's only one way to climb the money tree — up and up

New company: If your name is Bob Diamond (pictured) or Rich Ricci, there’s only one way to climb the money tree — up and up

Nonetheless, the merger is an important step forward for Panmure as it gains access to FinnCap’s specialist knowledge, particularly in the fast-growing life sciences and technology sectors.

The smaller firm is also the number one growth company broker and advisor listed on the junior market AIM.

It is an important link for the future of the city’s capital markets and ensures the Square Mile retains its role as a place for start-ups and small and medium-sized businesses to raise new funds, go public and expand.

Additionally, the deal should give the two companies an opportunity to cut costs amid declining corporate activity and IPOs, as well as tighter fundraising conditions around the world.

Others have already started the process. Numis, Peel Hunt and Zeus Capital have all cut staff in recent weeks, while FinnCap recently laid off 10 of its 150 employees.

FinnCap has endured its own rollercoaster ride, losing Sam Smith, its charismatic CEO and founder, after she decided to make a lifestyle change in September, although she remains a consultant. Over the past year, shares have more than halved.

That talks have reached this stage suggests that FinnCap’s biggest investors are on board, and that such ambitious figures as these two US bankers – Diamond and Ricci – who are running the show are giving the deal some much-needed momentum will.

FinnCap’s investors include a cast just as colorful as Panmure’s. Venture capitalist Jon Moulton, who helped Smith found the company, owns 11 percent. Smith himself has 9.85 percent.

Lord Leigh, former Treasurer of the Tory party, has 9p. Tech supremo Vin Murria, who lost her battle for M&C Saatchi, holds 10.3 percent.

FinnCap is publicly traded, so if the deal goes through, the new group could return to the public market through a reverse takeover – neatly and cheaply.

Such a move also puts Diamond, who owns nearly a quarter of Panmure through Atlas Merchant Capital, and Ricci back in the public spotlight after a painful journey since their controversial departure from Barclays over the Libor manipulation scandal.

After taking a majority stake in 2017, Diamond’s Atlas two years ago brought in notoriously obsessive racehorse owner Ricci, who calls himself “the craziest f****r alive” to run the brokerage house.

Since then, the duo have turned the loss-making company inside out

Rumor has it that Diamond and Ricci were deeply scarred, if not humbled, by their Barclays experience and wanted a chance to prove and redeem themselves with their peers.

If they go through with this deal to build a serious player in the capital markets, they may have almost regained their former reputation as brilliant, if astute, dealmakers.

The town still loves a villain, especially when he’s doing good business.

Green light for gilts

phew The confusion is over. After repeatedly denying reports that it was delaying the start of its gilt selling operation, the Bank of England has confirmed the sale will now take place on November 1st.

The bank was due to start selling gilts on October 31, having postponed the operation from its original date of October 6.

This was delayed due to the bond purchase package to support pension funds. But a newspaper report yesterday rattled the apple cart, claiming the bank was postponing the sale because of the fevered markets.

That was when the first denials came, when the bank’s spokesman, using unusually strong language – the word was imprecise – put an end to the rumours.

But the report was somehow correct. The bank is now targeting November 1 because it doesn’t want to start the sale — also known as quantitative tightening — on the same day the medium-term financial plan is launched.

I have it? Gilt yields on 10-year bonds initially spiked after reports of a delay, but fell back below 4 percent after the rejection. That’s the right direction.

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https://www.soundhealthandlastingwealth.com/business/maggie-pagano-the-city-loves-a-clever-rogue/ MAGGIE PAGANO: The town loves a sly villain

Brian Ashcraft

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