Inside Track: The City’s broking shake-up continues with Oriel sale

 
David Hellier
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WHEN the founders of Oriel Securities debated a name for the research and stockbroking firm in 2002 they couldn’t initially come to an agreement. Simon Bragg, now chief executive, suggested it should be called Oriel because three of the six had been to the Oxford college of the same name.

Now, 12 years later, the name will be gradually phased out as part of the US group Stifel’s takeover of the firm which brings an end to at least a couple of years of intense uncertainty.

The phasing out of the name comes as part of a consolidation among mid-cap brokers in the City that has already seen Evolution swallowed up by

Investec, Seymour Pierce by Cantor Fitzgerald and Collins Stewart by Canaccord as firms set about a strategy for coping with reduced volumes. Ironically, just as Oriel consummates its own deal, business has begun turning up, with the firm beating its own record last year for fundraising for clients.

Bragg must be relieved to have completed a deal, first suggested to him by his old friend Rupert Hume-Kendall, who is a big beast at Bank of America Merrill Lynch.

Rivals say that Oriel might face internal chaos, at least while the cultures of the US-based Stifel and London-based Oriel get used to each other. But Bragg is confident that Stifel, even with its ownership of Keefe, Bruyette and Woods, which has around 30 people in London, has little in the way of duplication with its new acquisition.

Takeovers of people businesses are always difficult to manage but Bragg might be right to be hopeful, even if this one comes from the other side of the Atlantic.

JP Morgan’s gradual assimilation of Cazenove has hardly been a failure, after all.

PRICED TO GO
Judging from yesterday’s announcement of a price range for the upcoming Saga float, it looks as if the over 50s insurer to leisure group has decided to listen to British shareholders about the danger of over-pricing its offer.

When it set the float process in motion a few weeks ago Saga’s advisers could have been excused for being a bit ambitious on pricing. There is massive retail interest in the group, largely from its 2m plus customer base, and at the time the IPO market was buzzing.

There has been considerable cooling since then, with a number of recently issued stocks trading below their issue price as well as an unseemly row with UK institutions about which sector Saga belongs too. Best to be on the cautious side now.

david.hellier@cityam.com