TROUBLED broker Hoare Govett could be about to lose its mandate with Tullow Oil.
Hoare Govett and current co-broker Bank of America Merrill Lynch are taking part in a beauty parade which will determine if they continue to work with the Africa-facing oil producer.
It comes just days after Hoare Govett lost another key client in insurer Amlin. The broker currently faces being sold or closed as part of a review by parent company Royal Bank of Scotland. BofA also has concerns, with key banker Andrew Osborne having left suddenly ahead of a regulatory probe – although he has told friends he will retain his licence.
Sources said Tullow would make a decision on its broker in the first quarter of next year, although the shake-up is not seen as a reflection on the work of Hoare Govett or BofA.
City A.M. understands security group G4S is also considering switching its brokers, currently Hoare Govett and Deutsche Bank, in the aftermath of its failed £5.2bn takeover attempt of Danish cleaning group ISS. All parties declined to comment.
RBS is expected to make an announcement on the future of Hoare Govett in February when it publishes its full year results.