Evolution agrees to buy Beeson Gregory

Evolution, the AIM-listed stockbroker, yesterday confirmed speculation about its interest in Beeson Gregory by announcing it has agreed to buy its more high-profile rival.

Evolution will pay 124p a share for Beeson, valuing the business at £92m. The price is a 13 per cent premium on Wednesday's closing price and a 42 per cent premium to Beeson's share price in April, when it first said it had received an approach.

Evolution will offer 1.77 shares of the enlarged company for each Beeson share in a move set to strengthen its presence in broking small and mid-cap stocks. It will also boost the company's number of corporate clients.

The all-share deal comes less than a year after the same two companies called off takeover talks, at a time when Beeson's stockbroking and corporate finance businesses was hit by a slump in financial markets.

Beeson had originally been in talks with the South African finance firm Old Mutual with a view to buying its broking arm. This proposal fell through last month, paving the way for Evolution to return to the fray.

Andrew Beeson, who founded Beeson and serves as its chairman, will be chairman of the new company. Alex Snow, 32, the former investment banker who is chief executive officer of Evolution, will keep that post.

Mr Snow said: "The merger of our two businesses will create an independent and fully integrated investment bank with a strong retail asset management business."

Evolution shares fell 9 per cent to 63.5p, while Beeson shares were unchanged at 110p.