Tue, May 26, 2009 page10

• Barclays to hire for advisory business

  PAN-EUROPEAN PLANS Barclays’ investment banking unit intends to take on teams in the UK, Germany, France and Italy, including heads of M&A for these territories

  • BLOOMBERG
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  Barclays Plc may hire as many as 65 bankers for its European mergers advisory business this year as Britain’s third-biggest bank seeks to become one of the top three global securities firms.

  Barclays Capital, the investment-banking unit, plans to add 30 to 40 bankers in Italy, Germany and France, as well as between 15 and 25 in the UK, Paul Parker, global head of mergers and acquisitions, said in an interview on Thursday. The firm named Mark Warham and Matthew Ponsonby co-heads of European M&A last week.

  Barclays Capital, which previously focused on bonds, loans and foreign exchange, surged to fifth in US takeovers after the acquisition of Lehman Brothers Holdings North American unit in September, according to data compiled by Bloomberg. The London-based firm ranks 21st in Europe, where Lehman’s operations were bought by Nomura Holdings Inc.

  “We aim to be top three across all products and regions” in investment banking, said Parker, who is spending a significant part of his time in Europe, helping recruit bankers. Barclays Capital wants to be a leader in cross-border deals “by combining the firm’s global perspective with local expertise.”

  Barclays Capital advised Pfizer Inc on its US$64 billion acquisition of Wyeth, the biggest takeover this year, and Verizon Communications Inc on its US$5.25 billion sale of phone lines to Frontier Communications Corp. It helped Dow Chemical Co sell a stake in a Dutch oil-refining venture with Total SA to Valero Energy Corp for US$725 million.

  Barclays Capital plans to hire teams in the UK, Germany, France, and Italy, including heads of M&A for the countries, Parker said. The additions will build upon existing coverage of the Iberian region, overseen by Inigo Paneda and a team hired last year from Nomura, Japan’s biggest brokerage.

  The firm also has about 30 former ABN Amro Holding NV bankers who will continue to focus on mergers and acquisitions in eastern and central Europe, as well as a team of about 15 in Asia, also primarily from ABN Amro, Parker said.

  Barclays Capital has advised on European takeovers worth about US$7.7 billion this year, giving it less than 3.5 percent of the market, Bloomberg data showed. That includes the firm’s agreement to sell its iShares exchange-traded funds business to CVC Capital Partners Ltd for US$4.37 billion.

  Credit Suisse Group AG is No. 1 in European mergers, followed by Citigroup Inc, Deutsche Bank AG, Morgan Stanley and JPMorgan Chase & Co, Bloomberg data show. Goldman Sachs Group Inc ranks seventh after UBS AG.

  “Barclays’s strong brand in Europe coupled with its strong lending and fixed income relationships positions us well to work with existing and new clients globally on transactions,” said Parker, who joined Barclays after the takeover of Lehman, where he ran global mergers with Mark Shafir, now at Citigroup.

  Jerry del Missier, president of Barclays Capital, said earlier this month that expanding in mergers advisory and stock underwriting in Europe and Asia was the “single-biggest initiative this year.”

  The firm aims to add about 300 people for European and Asian equities by the end of this year.

  Barclays Capital this month hired Sam Dean from Deutsche Bank AG to be co-head of global equity markets in London. Last month, it named Jim Renwick, a former vice chairman of investment banking at UBS, to run UK stock sales and corporate broking. The firm added senior coverage bankers in chemicals, oil and gas, metals and mining, healthcare and retail.

  Barclays Capital’s new European M&A co-head Warham was most recently chairman of UK investment banking at Morgan Stanley, a post he took in 2007. Ponsonby joins from Citigroup, where he was a global co-head of infrastructure investment banking.

  The firm is already “gaining market share” as it takes advantage of market dislocations, said Parker, who has more than 23 years of experience in M&A and advised on major telecommunications deals, including Cingular Wireless’ acquisition of AT&T Wireless Services in 2004.

  Barclays has so far avoided taking money from the UK government by boosting capital through stock and asset sales after US$18.6 billion of credit losses and writedowns during the global financial crisis. All the firm’s major US competitors, including New York-based JPMorgan Chase and Goldman Sachs, have taken bailout money.

  Mergers and acquisitions, down about 35 percent so far this year, will pick up as markets stabilize, said Parker, who expects to see deals in natural resources, including metals, mining and minerals, as well as power and infrastructure.

  “We’ll start to come out of it,” Parker said. “We expect activity to pick up meaningfully in the fall.”
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