Indian company buys London’s oldest stockbroker

April 5th, 2008 - 6:00 pm ICT by admin  

London, April 5 (IANS) The oldest stockbroker in the city of London has become the latest British institution to be acquired by an Indian company, snapped up in a 55 million pounds ($100 million) deal by a Delhi-based brokerage firm. Hichens Harrison, which has been trading for 205 years, was taken over Friday by Religare Enterprises, which is controlled by Malvinder and Shivinder Mohan Singh, owners of the drug company Ranbaxy.

The acquisition of Hichens Harrison, considered a bastion of Britishness, is expected to help Religare boost its investment banking operations and extend its geographical reach in emerging markets.

Hichens Harrison is said to be the only London stockbroking firm to have survived more than 200 years almost in its original form.

The deal was struck at a multiple of 13.1 times Hichens’ 2007 basic earnings per share.

Adam Wilson, the chief executive of Hichens, will make 4.3 million pounds from the deal, with fellow director Brian Rowbotham receiving just under two million pounds. The pair own about 13 percent of the firm between them and both will remain with the company.

Shachindra Nath, director of Religare Capital Markets, a Religare subsidiary formed to acquire Hichens, said: “Our objective is to build our company into India’s biggest financial institution and, having looked at other brokers in the UK, we came to the conclusion that Hichens, with its strong presence in emerging markets, would be the best fit for us.”

While Hichens’ core business has traditionally been in British broking, it has in recent years expanded its presence on the international stage and now makes 60 percent of its income from overseas markets, mainly in emerging markets.

Religare is also expected to use Hichens’ status as a nominated adviser to introduce more Indian companies to the London Stock Exchange’s Alternative Investment Market (AIM), a global market for smaller international companies.

Religare, which has a retail presence in 400 Indian cities and became a member of India’s National Stock Exchange (NSE) in 1994, made clear that it plans to use Hichens’s bases in South Africa, Argentina and Indonesia as a platform for its global ambitions.

“With the continued growth in the Indian economy, it is likely that a large number of investment opportunities to global institutional investors will be generated,” Nath said.

Religare, which employs 8,000 and has a market capitalisation of about 350 million pounds, will run Hichens Harrison under its historic name.

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