Barclays raids ABN AMRO to build corporate finance team

Barclays Capital strengthens its corporate finance franchise by hiring five senior bankers from ABN AMRO including the heads of M&A for Asia and India.
Barclays Capital (BarCap), the investment banking arm of the British bank Barclays, announced a bold move yesterday poaching a team of investment bankers from ABN AMRO to kick-start its corporate finance and M&A business.

Barclays may have lost the battle to buy ABN AMRO late last year, but its investment bankÆs latest move demonstrates that it is not ready to concede defeat in the war for advisory revenue. The UK-headquartered investment bank has poached five senior bankers from ABN AMRO to build its corporate finance franchise across Europe, the Middle East and Asia. And along with the five, will follow some team members.

Joining BarCap at a senior level are Jitesh Gadhia, Marc Holtzman, Simon Hargreaves, Jason Rynbeck and Frank Hancock.

Gadhia dons the mantle of global head of advisory. At ABN AMRO he was managing director of corporate finance. Holtzman joins as managing director and vice-chairman of investment banking; Holtzman was a senior relationship banker and a vice-chairman at ABN AMRO. Hargreaves joins as the head of advisory for Europe, the Middle East and Africa (EMEA); he was previously the head of M&A for Central and Eastern Europe, the Middle East and Africa. Holtzman and Hargreaves were both MDs at ABN AMRO. Gadhia, Holtzman and Hargreaves will all be based in London and will report to John Winter, head of European investment banking and debt capital markets at BarCap.

Rynbeck joins BarCap as head of advisory for the Asia-Pacific region; he was earlier and MD and the head of M&A for Asia at ABN AMRO. Rynbeck continues to be based in Hong Kong and will report to Gadhia and to Darcy Lai, head of investment banking and debt capital markets for the Asia-Pacific at Barclays. Hancock joins as managing director and head of advisory for India; he was head of M&A for ABN AMRO in India, based in Delhi. Hancock will report to Raju Shukla, head of investment banking for BarCap in India and to Rynbeck.

2007 was almost a break out year for ABN AMRO in M&A advisory in Asia. The firm realised early that financing would be a critical element for M&A deals in the region. Through a combination of advice and putting its balance sheet to work, the bank won and successfully executed some of the regionÆs defining deals such as the $12 billion privatisation of Maxis in Malaysia and the $14 billion acquisition of Corus UK by India's Tata Steel.

Barclays Capital is obviously hopeful that this team will build upon its existing strengths and deliver similar successes to the British bank, both in Asia and elsewhere across the globe. And speculation is rife that the five will be taking team members with them. Some sources say up to 40 people could jump ship to BarCap, suggesting the exodus is by no means over, only the top slots have been filled. Other sources close to the development refute this and say only a maximum of 25 jobs have been affected.

Barclays has taken this move at an interesting time as a number of subprime-affected banks are downsizing headcount currently and CVs are said to be floating around. BarCap is gambling that the team of people it is bringing on board will be a quicker and more effective way of cementing its corporate finance business than building a team through discrete hires. And as teamwork is a hallmark of the most effective investment banking franchises, the British investment bank could have placed its bets wisely.

BarCap adopted a similar strategy in 2001 when it brought Darcy Lai on board. Lai raided Deutsche Bank and brought a team of his former colleagues with him.

Royal Bank of Scotland, which won the race to buy ABN AMRO last October, is making some changes at ABN AMRO following the takeover but is not expected to make a wholesale reduction in people. And some of the bankers who have jumped ship to Barclays Capital have strong Asia and Middle East expertise, which is the geography where there is little overlap between RBS and ABN AMROÆs businesses and thus few job losses were expected.

ôWe know from past experience that when you integrate, some people will choose to move on,ö says an RBS spokesperson, commenting on the departure. ôThe advisory business is core to our franchise and with a global team of over 600 people, we will continue to deliver for our clients.ö

Sources close to RBS say the firm has moved quickly to plug gaps created by the departures and the moves have resulted in new roles, in some cases with promotions, for a number of existing bankers. Headhunters are also busy identifying new hires and, as earlier stated, the current environment could result in the bank finding some strong candidates to fill the vacancies.
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