One of Citi’s major independent investment banks, Peel Hunt, is making a comeback in the public markets 20 years after taking it to private markets.
Sky News has learned that Peel Hunt’s management, led by Chief Executive Officer Steven Fine, has appointed Evercore to advise on the process, allowing for an initial public offering (IPO) in the next 12 months.
Insiders said on Thursday that a flattening could give a broker a price somewhere in the region of £ 350m.
If it goes ahead with a listing, it would represent a winning return to the stock market for Peel Hunt.
A float would also trigger windmills for many of the company’s 280 employees – most of whom are shareholders.
Peel Hunt has been selected for public flotation by the resurgent market in London, raising £ 7.2bn from the IPO in the first quarter of this year – the highest level for 15 years.
Although the mood of bankers has diminished with the excitement surrounding Delivero’s public market debut, there remains a long queue of companies willing to sell shares on the London Exchange.
Peel Hunt last changed hands in 2010, when its employees took majority ownership from KBC, a Belgian bank that was mired in the 2008 financial crisis.
The deal, which valued Peel Hunt at £ 74m, was backed by a collection of wealthy individuals, including insurance tycoon Neil Utley.
KBC paid £ 219m to buy Peel Hunt a decade ago.
In 2018, Spanish lender Santander showed a fleeting interest in the acquisition of Peel Hunt, but Mr. The deal did not succeed after Fine insisted.
Peel Hunt competes with companies such as Cenkos Securities, Numis, Liberum and N + 1 Singer to work on merger advice for listed companies.
Based on the cost-to-earnings ratio of listed peers, some analysts believe Peel Hunt may now be worth £ 350m.
Many mid-market investment banks in the city have been hit hard by the rules of the new European markets known as Mifid II.
Peel Hunt has been a beneficiary of the changes, however, with 1200 institutions signed up to receive their research – three times before the new system was introduced.
The firm’s corporate clients include JD Sports Fashion, John Ling, Mitty and Premier Foods.
It now boasts over 150 listed customers with an average market capitalization of £ 700m.
People close to the firm warned that an IPO was not certain to proceed, but said it was being actively searched.
As of March 31, 2020, Peel Hunt reported revenue growth of over 30%, with insiders saying momentum was still on in the fiscal year.
A spokesperson for Peel Hunt declined to comment.