Financial News: Hoare Govett Gets FTSE 100 Broking Win

20th Jul 2010 07:48

By Liam Vaughan Of FINANCIAL NEWS RBS Hoare Govett, the old ABN Amro corporate broking business, picked up its first FTSE 100 client since being taken over by Royal Bank of Scotland (RBS) in 2007 in a development that could halt its slide down the corporate broking rankings. RBS Hoare Govett has been appointed joint corporate broker alongside Deutsche Bank (DB) to U.K. telecoms group Cable & Wireless Worldwide, according to sources familiar with the situation. The new client was formed following a demerger of Cable & Wireless Plc into business telecoms division Cable & Wireless Worldwide and retail-focused Cable & Wireless Communications. The latter, which kept the original listing and is now a FTSE 250 company, continues to use JP Morgan Cazenove and RBS Hoare Govett as its corporate brokers. Corporate brokers sit between a company and its institutional investor base, ensuring good relations and rallying support for capital raisings, M&A and other corporate activity. While fees for corporate broking are relatively modest, competition is always fierce for brokerships because mandates are an avenue for investment banks to pick up fees as advisers on future corporate finance work. Market leader JP Morgan Cazenove, which is corporate broker to more than one-third of the U.K.'s largest companies, is consistently number one for equity capital markets. Sources said RBS Hoare Govett and Deutsche Bank is understood to have won the mandate following a competitive pitching process. The mandate is a major boon for RBS Hoare Govett, which is hoping it will stem the tide that has seen it slip down the rankings since the ill-fated merger between RBS and ABN Amro three years ago. Once the number two broker in the U.K., RBS Hoare Govett is currently ranked eighth with 10 FTSE 100 clients, according to the most recent rankings by Hemscott. JP Morgan Cazenove, Bank of America Merrill Lynch and UBS are first, second and third respectively. It also marks the second FTSE 100 client win for Deutsche Bank in the past month. In June Deutsche Bank poached insurer Royal & Sun Alliance from Bank of America Merrill Lynch, alongside incumbent JP Morgan Cazenove. Deutsche Bank, RBS Hoare Govett and Cable & Wireless Worldwide declined to comment. Web site: www.efinancialnews.com (END) Dow Jones Newswires July 20, 2010 02:48 ET (06:48 GMT)