Corporate Financial Advisers: Accelerators of Company Growth (Executive Briefings)

162 Pages·2002·0.52 MB·English

by  Louise Broby

Corporate Financial Advisers
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Corporate Financial Advisers
Accelerators of company growth
LOUISE BROBY
An imprint of Pearson Education
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First published in Great Britain in 2002
© Pearson Education Limited 2002
The right of Louise Broby to be identified as author
of this work has been asserted by her in accordance
with the Copyright, Designs and Patents Act 1988.
ISBN 0 273 65641 4
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About the author
Louise Broby is a financial writer who has written extensively on a wide range of
topics. Her publications include Investment Regulation in Europe, Global Stock
Markets, Pan-European Financial Regulation and Stock Market Globalisation.
She has worked in investment banking and as a business school academic. Louise
may be contacted at:
Stratos Multimedia
6th Floor
175 Piccadilly
London W17 9TB
Tel: [phone]
Fax: [phone]
Email: [email protected]
v

Contents
List of tables xi
List of figures xiii
Preface xv
Executive summary xxi
Acknowledgements xxiv
Introduction xxv
1 Factors affecting the selection of corporate
financial advisers 1
Overview 3
Making the right choice 3
Expertise 3
Reputation in the marketplace 4
Synergy with the client company’s financial strategies 5
Relative size of the client company and its financial advisers 5
M&A deal size 6
Client list/recommendations 6
International presence 6
Lead-managers/co-managers 7
Conflict of interest 8
Products and services offered 8
Access to capital markets 8
Globalization of markets 9
e-Commerce strategies 9
Personal relationships 10
Fees 10
Conclusion 10
vii
Contents
2 The top league of professional advisers 13
Overview 15
League tables 15
Conclusion 29
3 Corporate financial advisers in the United States 31
Overview 33
Economic outlook 33
Layoffs 34
Global reach 34
Magnitude of stock markets served by financial advisers 40
Clients of US financial institutions 41
Conclusion 41
4 Raising of finance 43
Overview 45
Funds for day-to-day trading operations 45
Asset finance 46
Loans for high-value acquisitions 46
Futures and options 47
Equity capital 47
Conclusion 56
5 Listing on the stock exchange 57
Requirements for listing 59
Methods of listing 59
Reasons for listing 60
The sponsor 61
Phases in the flotation process 61
Ways of entering the stock market 67
Choice of stock market 68
Entering the market via a shell company 74
Conclusion 75
6 Private and public fund-raising – documents
and processes 77
Overview 79
The business plan 79
viii
Contents
The Prospectus 84
Private Placement Memorandum 87
Conclusion 87
7 Transactional activities – the M&A market 91
Overview 93
Drivers of M&As 94
Information required for the M&A process 94
The deal process 95
Overseas targets 97
Management buy-outs/buy-ins 97
The City Code on Takeovers and Mergers 98
M&A activity in 2001 99
The big M&A players 100
Conclusion 100
8 Regulatory issues 103
Overview 105
The Bank of England 105
The Financial Services Authority (FSA) 105
Regulation in the US 108
Regulation in the European Union 109
Main EU financial services directives 109
Conclusion 114
9 Case study – Close Brothers 115
Overview 117
Products and services 117
Group performance 119
Integrated model of advisory services 120
Steering clear of the IPO dot.com bubble 121
Business strategy 121
Sectoral approach 121
International capabilities 123
Competition 123
International expansion 123
Local market orientation 123
Strategic alliance in the US 124
ix
Contents
Organization structure 124
Deal size 125
Fee structure 125
Targeting the mid-market 125
Marketing 125
Conclusion 126
10 Summary of conclusions 127
Chapter 1 129
Chapter 2 129
Chapter 3 129
Chapter 4 129
Chapter 5 130
Chapter 6 130
Chapter 7 130
Chapter 8 131
Chapter 9 131
Overall conclusion 131
x