Mark Leftly: Hoare Govett has a chance for absolution in Countrywide's float

Outlook The news that the UK's biggest estate agent by revenue, Countrywide, is looking to again sell shares on the London Stock Exchange has been painted as marking one or more of the following:

a) the return of flotations: very few new equities have been launched since the onset of the credit crunch, but Countrywide is poised to join the recently listed Direct Line and housebuilder Crest Nicholson as an exciting FTSE 250 entrant;

b) the rise of the housing market: if the owner of Arabian mansions-to-golf courses agent Hamptons International and the 113-year-old Bairstow Eves is hopeful of raising £200m to pay off loans, there must be some real signs of a property boom;

c) the triumphant comeback of Countrywide itself: overloaded by debt when it was bought for what now seems an astonishing £1.1bn in 2007, the group was rescued two years later by Oaktree Capital and has now been largely rebuilt.

As far as stories about equities can be poignant, these are almost tear-jerking yarns of victory in the face of adversity, the mighty falling to their knees only to stand tall once more.

But they also mask another fascinating back-from-the-brink tale: the quiet revival of Hoare Govett, the venerable stockbroker that in the post-war years was run by the legendary City gent Kit Hoare, but more recently found itself as a barely regarded, and certainly unloved, offshoot of state-owned Royal Bank of Scotland.

One of the bookrunners named on the Countrywide float is Paul Nicholls, the head of what is now Jefferies Hoare Govett. This means that his firm, which acts as a conduit between companies and shareholders, is in pole position to pick up the estate agent as a broking client once the flotation is completed.

Such a talked-about FTSE newbie would be a fine addition to any broker's client list, but for Hoare Govett this would represent something far greater: absolution.

RBS dumped Hoare Govett for a token sum to the United States's Jefferies in February last year, as chief executive Stephen Hester retreated from that nasty practice of investment banking. Outside of an RBS that lumped all investment bankers together, Hoare Govett had successfully resisted that toxic image: rivals saw the broker as an honourable institution, evoking images of an aristocratic City that would stick to its word, work hard for its clients, and seal a deal over a glass of Scotch and a handshake.

Although that sepia-tinted view of pre-Thatcher stockbroking no longer represented the reality, Hoare Govett remained one of the great names in the industry. But even the most fiercely loyal feared for Hoare Govett's future under the leadership of a tough US investment bank.

Certainly, Hoare Govett was struggling before and after the Jefferies takeover, having been made one of the scapegoats for G4S's embarrassing failure to buy Danish cleaner ISS for £5.2bn, while clients like beer cans maker Rexam and GlaxoSmithKline also wielded the axe.

Even RBS dispensed with the services of its former subsidiary, which seemed to confirm rumblings that Hoare Govett had been understaffed and under-supported after being snapped up as part of the then Sir Fred Goodwin's absurd pursuit of ABN Amro in the first months of the crisis.

However, despite losing so many big name corporates, Hoare Govett now has 75 clients, about 10 more than when it became a part of Jefferies.

There has been a focus on areas where Jefferies already has strength, such as natural resources, resulting in Hoare Govett picking up the likes of Severstal spin-off Nordgold and Asia-focused oil explorer Salamander Energy.

Most instructively, Hoare Govett regained a former client, Cairn Energy, last month. Hoare Govett had lost Cairn as the broker did not have an analyst covering oil exploration and production when owned by RBS; Jefferies gave the broker the expert manpower that the client demanded.

Countrywide has yet to decide which of the three bookrunners – the others being Goldman Sachs and Credit Suisse – will be made its broker, and there is even the long shot that the estate agent could look elsewhere if the trio do a bad job on the flotation.

But the fact that Hoare Govett's historic name is now being linked to client wins rather than losses, barely a year after its nadir, marks its story out as a bit of a modern City fairy tale.

Start your day with The Independent, sign up for daily news emails
Arts and Entertainment
Books should be for everyone, says Els, 8. Publisher Scholastic now agrees
booksAn eight-year-old saw a pirate book was ‘for boys’ and took on the publishers
Life and Style
Mary Beard received abuse after speaking positively on 'Question Time' about immigrant workers: 'When people say ridiculous, untrue and hurtful things, then I think you should call them out'
tech
Life and Style
Most mail-order brides are thought to come from Thailand, the Philippines and Romania
life
News
i100
Life and Style
tech
Voices
Margaret Thatcher, with her director of publicity Sir Gordon Reece, who helped her and the Tory Party to victory in 1979
voicesThe subject is being celebrated by the V&A museum, triggering some happy memories for former PR man DJ Taylor
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Treasury Assistant - Accounts Assistant - London, Old Street

£24000 - £26000 per annum + benefits : Ashdown Group: A highly successful, glo...

Ashdown Group: Business Analyst - Financial Services - City, London

£50000 - £55000 per annum: Ashdown Group: Business Analyst - Financial Service...

SThree: Trainee Recruitment Consultant

£18000 - £23000 per annum + OTE £45K: SThree: At SThree, we like to be differe...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + competitive: SThree: Did you know? SThree is the o...

Day In a Page

General Election 2015: Chuka Umunna on the benefits of immigration, humility – and his leader Ed Miliband

Chuka Umunna: A virus of racism runs through Ukip

The shadow business secretary on the benefits of immigration, humility – and his leader Ed Miliband
Yemen crisis: This exotic war will soon become Europe's problem

Yemen's exotic war will soon affect Europe

Terrorism and boatloads of desperate migrants will be the outcome of the Saudi air campaign, says Patrick Cockburn
Marginal Streets project aims to document voters in the run-up to the General Election

Marginal Streets project documents voters

Independent photographers Joseph Fox and Orlando Gili are uploading two portraits of constituents to their website for each day of the campaign
Game of Thrones: Visit the real-life kingdom of Westeros to see where violent history ends and telly tourism begins

The real-life kingdom of Westeros

Is there something a little uncomfortable about Game of Thrones shooting in Northern Ireland?
How to survive a social-media mauling, by the tough women of Twitter

How to survive a Twitter mauling

Mary Beard, Caroline Criado-Perez, Louise Mensch, Bunny La Roche and Courtney Barrasford reveal how to trounce the trolls
Gallipoli centenary: At dawn, the young remember the young who perished in one of the First World War's bloodiest battles

At dawn, the young remember the young

A century ago, soldiers of the Empire – many no more than boys – spilt on to Gallipoli’s beaches. On this 100th Anzac Day, there are personal, poetic tributes to their sacrifice
Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves

Follow the money as never before

Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves, reports Rupert Cornwell
Samuel West interview: The actor and director on austerity, unionisation, and not mentioning his famous parents

Samuel West interview

The actor and director on austerity, unionisation, and not mentioning his famous parents
General Election 2015: Imagine if the leading political parties were fashion labels

Imagine if the leading political parties were fashion labels

Fashion editor, Alexander Fury, on what the leaders' appearances tell us about them
Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

The architect of the HeForShe movement and head of UN Women on the world's failure to combat domestic violence
Public relations as 'art'? Surely not

Confessions of a former PR man

The 'art' of public relations is being celebrated by the V&A museum, triggering some happy memories for DJ Taylor
Bill Granger recipes: Our chef succumbs to his sugar cravings with super-luxurious sweet treats

Bill Granger's luxurious sweet treats

Our chef loves to stop for 30 minutes to catch up on the day's gossip, while nibbling on something sweet
London Marathon 2015: Paula Radcliffe and the mother of all goodbyes

The mother of all goodbyes

Paula Radcliffe's farewell to the London Marathon will be a family affair
Everton vs Manchester United: Steven Naismith demands 'better' if Toffees are to upset the odds against United

Steven Naismith: 'We know we must do better'

The Everton forward explains the reasons behind club's decline this season
Arsenal vs Chelsea: Praise to Arsene Wenger for having the courage of his convictions

Michael Calvin's Last Word

Praise to Wenger for having the courage of his convictions