(JP Morgan to buyout UK's Cazenove)
November 15, 2009
Queen’s brokers to land millions in Cazenove sell-off
Uppercrust financiers are sharing in a £950m bonanza from the sale of Cazenove bankIain Dey and Maurice Chittenden
The blue bloods of British banking are to cash in on the sale of one of the City’s last private money houses. They stand to earn millions from the sale of Cazenove, stockbrokers to the Queen and the last of the “old guard” of independent City investment banks.
Those who will share in a £950m “jackpot” include Lord Killearn, 68; Viscount Garmoyle, 44; and Christopher Palmer-Tomkinson, 67, whose older brother, Charles, a former British Olympic skier, is a close friend of Prince Charles and father of Tara, the “It” girl.
All three are former stockbrokers at the bank who kept their shares when it merged with JP Morgan, the American banking giant, in 2004.
The US bank bought 50% of the shares then and had an option to buy the other half after a five-year partnership deal which ends next month.
In the interim the aristocrats and old Etonians who make up many of this group have invested in “new money”.
Killearn, a former captain in the Scots Guards who lives in a 15th-century manor house Gloucestershire, is company secretary of Sexy Panties and Naughty Knickers, an upmarket lingerie firm, and has been a director of several investment companies operating on the Pacific rim. He will make about £9m in the Cazenove deal.
He and fellow old Etonian Garmoyle are investors in Ingenious Film Partners, alongside footballers David Beckham and Wayne Rooney. Their money has helped produce such films as Australia, the epic starring Nicole Kidman.
However, it is the “old money” from a bank founded by French Huguenots in 1823 that has given them their biggest return.
Garmoyle, whose father Lord Cairns was chief executive of Warburg’s, another independent bank, until 1995, was a partner at Cazenove but left a year ago. City experts believe he will gain about £8m.
Garmoyle said yesterday at his old rectory home in Essex: “The expectation is that JP Morgan and Cazenove will make an announcement before Christmas and that JP Morgan will buy the other 50%.
“If you want up-to-date information on the way negotiations are going I expect you will be greeted with a wall of silence.”
He added: “I really can’t comment on how much I might make on this crystallising event. If you want really exciting numbers you should talk to the people at Goldman Sachs.
“It is a shame Cazenove is disappearing. In 2004 we had a fantastic client list but the people we were competing with had access to far more capital. It would have been very difficult for Cazenove to have kept its corporate and client list without access to the balance sheet of a bank like JP Morgan.”
Palmer-Tomkinson is also an investor in a second film fund, Ingenious Film Partners 2, alongside Nick Hornby, the writer, Trevor Horn, the music producer, and Gary Lineker, the Match of the Day presenter.
Palmer-Tomkinson was previously a director of the Jersey-registered Highland Gold Mining which produced gold in Russia and whose shareholders included Roman Abramovich, the Chelsea owner.
Palmer-Tomkinson stands to make between £10m and £12m from the JP Morgan deal. David Mayhew, 69, Cazenove chairman and another old Etonian, could make as much as £20m.
The last Cazenove to work for the firm was Bernard Cazenove, 62, head of its fund management business, who retired in 2004. He is the great-great-great grandson of Philip Cazenove, the founder, and is expected to pick up more than £14m.
http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article6917334.ece
