Hands finally goes own way after amicable divorce from Nomura

Nomura is considering setting up another in-house European private equity operation, after confirmation yesterday that Guy Hands and his Principal Finance Group, the bank's main interest in this sector, is going independent.

Mr Hands, one of the City's most prolific deal makers, who transformed Nomura into Britain's biggest pub landlord through a series of transactions, is now raising €3bn (£2bn) for his own Terra Ferma Fund. However, Terra Ferma will manage the assets Mr Hands bought for Nomura, for a fee, and the Japanese bank will invest in the new fund, up to 10 per cent of the capital raised.

Nomura announced the move initially in November but the final agreement was only signed yesterday.

The new arrangements will take effect at the end of March but Mr Hands is already busy making presentations to potential investors. So far his team has met 86 investors, out of a possible 350 such meetings planned. These investors will then conduct due diligence on the fund so it could take the rest of the year to finalise the vehicle's size and shape.

Takumi Shibata, the chief executive of Nomura International, said: "It is important that our financial resources are appropriately allocated in a way that ensures increased diversification and is consistent with our long-term strategic objectives."

A Nomura spokesman said it was now considering its options for another in-house private equity business for Europe.