Panmure Gordon, the City stockbroker, has sold a near 10 per cent stake to an Egyptian investment bank with significant operations in the Middle East, as both companies look to expand into new markets.
Panmure, which is more than 130 years old, has agreed to place almost 7 million new shares with EFG-Hermes for £3.2m, translating into a 9.97 per cent holding in the group. The news sent AIM-listed Panmure's share price up 7.5 per cent to 50p yesterday.
Tony Caplin, Panmure's chairman, said: "The markets we operate in are becoming more international and the opportunities available through a business relationship with EFG-Hermes are compelling."
He added that the move will give it a "major competitive advantage" as it can gain access to EFG-Hermes' clients, and the Egyptian group can do the same with Panmure's clients in the UK and US.
Hasan Heikal, head of EFG-Hermes, said he saw "an opportunity to develop a partnership that can drive very real benefits for our respective clients".
EFG-Hermes was set up in 1984, specialising in investment banking, asset management and private equity as well as securities brokerage and research. It has a market capitalisation of $3.2bn (£1.7bn).
Panmure's chief executive, Tim Linacre, said: "There is turmoil in the markets and we can't just rely on our traditional clients. To be a significant player we felt we needed operations in the Gulf." The companies are looking at transferring staff to each other's offices as well as moves to share research and conferences.
Mr Linacre did not rule out more tie-ups: "We need more exposure to growth markets around the world."Reuse content