One door closes, while others open - Editor’s letter

David Hellier
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The big banks are taking a break until the New Year (Source: Getty)
Investment bankers are a bit like accountants. They see opportunities from every eventuality.

Accountants thrive in the good times and the bad, with the big firms’ restructuring departments jumping into action when the economy turns sour.

Yesterday as BCA Marketplace, owner of the website, pulled its stock market flotation in London, I asked one banker who has handled many of the IPOs in the London market this year, whether he felt the new issue door had closed.

“More or less,” he said, prompting me to ask him what he would be up to for the rest of the year. “Rescue rights issues,” was his response.

It’s not clear just yet whether the choppy market and economic conditions will mean a host of rights issues – think the likes of Tesco here – but there’s always some aspect of corporate financing that the big banks can get busy with.

London was abuzz with new issues in the first half of the year, but the market never really got going again after the August bank holiday.

Several issues, such as Saga and Card Factory, damaged confidence and investors’ appetite has gradually turned sour.  Throw in the uncertainties caused by the Scottish referendum, the nervousness of Wobbly Wednesday last week, concerns about the end of tapering in the US and you have a closing of the market for big-sized deals, unless they price at the bottom of expectations as Jimmy Choo did.

At the smaller end of the market, broking houses such as Zeus Capital, Numis and Investec are having more success with raising money (see page 10 for one example). Investec is currently doing the rounds with Fevertree, the premium mixers’ brand, unperturbed by market turbulence. The bigger banks are largely pausing for breath until the New Year.

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