Barclays has signalled ambitions to push into mergers and acquisitions by poaching five senior investment bankers from ABN Amro, seven months after the UK lender lost out to Royal Bank of Scotland in a battle for the Dutch bank.
The bankers are joining Barclays’ investment banking division, Barclays Capital, where they will form a dedicated advisory team specialising in M&A. The unit is looking to hire as many as 40 bankers, Barclays said.
The bank wants to centralise its existing M&A advisory business. This has separate debt, credit rating and balance sheet teams advising companies on transactions. These have focused traditionally on purely financial aspects of deals, such as the appropriate capital structure for a divested subsidiary.
John Winter, head of European investment banking and debt capital markets at Barclays, said the bank was now happy to engage in the more tactical elements of deal advice that are associated with the M&A business.
“We already have extensive advisory capabilities across financing and risk management and have been engaged in some M&A activities for years,” he said. “We provide a lot of advice for clients around transactions but we haven’t called it M&A.”
The European investment banking unit of Barclays Capital employs about 600.
Barclays tried to buy Cazenove, the British stockbroker and M&A adviser, in 2004. The latest push comes as the bank finalises a trading update due tomorrow, which analysts expect to contain fresh writedowns on structured credit positions and leveraged loans.
The defections are the latest in a series of high-profile departures from ABN that insiders attribute to mounting frustration at the slow pace of progress in integrating the business into RBS.
Johnny Cameron, head of global markets at RBS, delivered a pep talk at ABN’s London offices in a bid to lift morale and stressed the importance of M&A and equities to the group.
Two people with knowledge of the integration process said the timetable had been necessarily slow because the Dutch Central Bank had not approved the integration plan until March. The deal was completed in October.
However, the defecting bankers – dubbed “rainmakers” by former colleagues – did not have roles that overlapped in RBS and would have been certain of their future within the group.
Jitesh Gadhia, formerly a managing director in corporate finance at ABN, is to become global head of advisory at Barclays. Marc Holtzman, previously a vice-chairman at ABN, becomes vice-chairman in investment banking at Barclays.
Simon Hargreaves, who ran ABN’s European emerging markets M&A franchise, will head Barclays’ advisory business for Europe, Middle East and Africa. Jason Rynbeck, previously head of ABN’s Asia-Pacific advisory business, and Frank Hancock, who ran ABN’s advisory business in India, move to similar roles in Barclays.
“We know from past experience that when we integrate businesses some people move on,” RBS said. “The advisory business is a core offering for our corporate and institutional clients.”