Qatar's largest investment bank, QInvest, trumped two other bidders to buy a 44 percent stake in Panmure Gordon & Co, investing $36.3m in the 130-year-old British stockbroking firm.
The deal would involve a placing of 67.5 million shares, priced at 34 pence per share, Panmure said on Thursday, a 15 percent discount on Wednesday's closing price.
Panmure said the cash injection would enhance its balance sheet and give it the financial strength to grow into new business areas and locations, including the Gulf.
"The Gulf is an area of outstanding opportunity, tremendous wealth creation, great and very deep pools of capital and ones that actually are very poorly penetrated by firms such as ourselves," Panmure chief executive Tim Linacre told reporters.
Last month Panmure announced plans to raise GBP15m through a share placing with private equity firm BlueGem Capital Partners, at a price of 24 pence per share.
However, after receiving alternative proposals from QInvest and hedge fund millionaire Bertrand des Pallieres's SPQR Capital, Panmure began a three-way auction.
Panmure, whose shares rose 5 percent to 42.5 pence by 0800 GMT, said QInvest was keen to take advantage of the British firm's brand and reputation.
Panmure said it would have regulatory assets of around GBP45m after the deal, leaving it in a strong position to withstand further market turbulence.
Linacre said business was showing signs of picking up and he intended to put the new capital to work, focusing primarily on establishing new businesses.
"I wouldn't rule acquisitions out but I can't see any great pressing need to go out and make them," Linacre said.
"I think I can get far more bang for my buck by establishing new business areas and moving into new geographies, particularly in the Gulf."
QInvest had made it clear there was further capital available to Panmure if it found any investments it wanted to make, he added.
Panmure's board will be expanded to 10 people with addition of four new non-executive directors from QInvest, including Chief Executive Shahzad Shahbaz, a former head of Europe, Middle East and Africa investment banking at Bank of America, the company said. (Reuters)For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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