Hambro Magan in pounds 70m bonanza from NatWest bid

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The Independent Online
Forty of the City's top corporate financiers are set to share in a pounds 70m bonanza after NatWest Markets yesterday snapped up the investment banking boutique Hambro Magan.

The two remaining co-founders of the business, George Magan and the American financier, Alton Irby III, are thought to be receiving at least pounds 20m from the deal. Hambro Magan's 38 other employees, including Sir Michael Richardson, a leading light at the company, are reckoned to be getting "golden handcuff" payments of pounds 1m each.

Neither Martin Owen, chief executive of NatWest Markets, nor Mr Magan, chairman of Hambro Magan, would reveal the terms of the deal.

But City insiders said Mr Magan would not sell off his stake in the company he formed in 1988 for less than pounds 10m. Mr Magan said: "There is a significant element of golden handcuffs."

Together with the individual payments to Hambro Magan's staff this would imply a total value for the deal of around pounds 70m if it was conducted under similar terms to NatWest's acquisition last year of Gleacher in the US for which it paid $135m.

The deal came as a shock in the City where Hambro Magan has built a reputation as a skilled deal-maker precisely because of its independence, size and nimble approach.

Last year Hambro Magan was ranked 15th in the UK mergers and acquisitions league table advising on deals valued at pounds 4.45bn. Among the biggest deals it has handled in the eight years since it was set up are Ford's pounds 1.6bn takeover of Jaguar, Deutsche Bank's pounds 950m acquisition of Morgan Grenfell, Rhone Poulenc's hostile bid for Fisons and the pounds 2.9bn MAI-United News & Media merger.

The deal is part of NatWest's push into the corporate finance arena and quashes speculation that the bank would snap up Rothschild to help boost its image after the Blue Arrow affair.

Mr Owen said the merged operation, which would be run out of a new, as yet undecided, location in the City, would propel NatWest Markets to the forefront of the highly competitive corporate finance world.

The combined transactions of NatWest, Hambro Magan and Gleacher NatWest reached $50bn (pounds 32bn) for the first nine months of the year, placing the entire operation at number 11 in the world league tables of deals.

Mr Magan, 50, will take a new role at NatWest Markets, becoming chairman of the UK and continental European corporate advisory business with a package that locks him on long-term.

"He is pretty firmly lashed to the tiller," Mr Owen said.

Mr Magan said: "It's more akin to a significant team moving [than a merger], like Deutsche Morgan Grenfell taking a team out of ING Barings."

Comment, page 21

pounds 1.6bn agreed takeover of Jaguar by Ford

pounds 950m acquisition of Morgan Grenfell by Deutsche Bank

pounds 1.5bn hostile takeover of Hawker Siddeley by BTR

pounds 210m flotation of Graham Group by BTR

pounds 757m sale of Tiphook's container operations to Transamerica

pounds 1.8bn hostile offer for Fisons by Rhone-Poulenc Rorer

pounds 2.9bn merger of United News & Media and MAI

pounds 860m acquisition of investment banking business of SG Warburg by SBC

Big deals handled by Hambro Magan