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Corporate broker Peel Hunt has raised £112m in a flotation on the London stock market to capitalise on the boom in dealmaking and other corporate activity.
The fundraising on Aim, London’s junior market, values the small and mid-cap stock specialist at about £280m. About £40m has been taken in new capital, while selling shareholders are expected to make about £72m, leaving a free float of 40 per cent.
Peel Hunt said the money raised in the placing would be used to support the next phase of the company’s growth, including establishing a European presence and continuing its investment in technology, new products and services.
It added that “a significant portion” of the money raised for existing shareholders would be used to fund personal tax liabilities arising from the corporate restructuring needed ahead of the flotation.
The broker wants to open a European office for EU clients next year given difficulties providing full services to the region after Brexit. It has been majority-owned by employees, including staff and investors that led a buyout of the company from Belgian bank KBC more than a decade ago.
Peel Hunt has benefited from the boom in corporate dealmaking over the past year. The UK has seen a surge of M&A transactions, with public companies a focus for private equity buyers. There has also been a sharp rise in IPO activity as more businesses have sought to tap public markets for funding to see out the pandemic.
Steven Fine, chief executive, said he was “delighted with the positive reception to our IPO, with strong support from institutional investors as well as retail investors”.
At the end of August, the group said it had 157 corporate clients with an average market capitalisation of £775m. Its research is provided to more than 1,200 institutions, mainly in the UK and US.
The company, founded in 1989, made revenues of £196.8m in the last financial year, up from £95.5m in the previous year, and said it was “well placed to continue increasing its market share and benefit from product and geographical expansion and structural changes in retail investment markets”.
In the financial year ended March 31 2021, 47 per cent of all retail trade value in the UK was dealt on its trading platform, the company has said — up from 19 per cent four years ago.