Execution Noble sells 50.1% stake to bank in Portugal

EXECUTION Noble, the investment bank formed by the merger in December of Edinburgh-based Noble Group with London-based Execution, has agreed to sell a controlling stake in the business to a Portuguese investment bank.

Banco Espirito Santo de Investimento (BESI), the investment banking operations of Portugal's largest listed bank, Banco Espirito Santo, will acquire a 50.1 per cent stake in the firm for an undisclosed sum.

The deal was announced days just after the Financial Services Authority (FSA) approved the merger of Execution and Noble.

Angus Macpherson, the former chief executive of Noble and now deputy chief executive of the merged group, confirmed that the Edinburgh firm was aware of the potential sale when it merged with Execution. He hailed it as great opportunity for the development of the Edinburgh office.

"Most of the operators up here have tended to be corporate finance boutiques which is where Noble started," said Macpherson.

"Effectively there is a branch now of a firm with the capability to access global capabilities, which bluntly no-one else has got. It is as if Goldman Sachs had an office in Edinburgh.

"If you look at what we are today compared to two years ago, we have just sealed a deal which has put us into a position to have global critical mass."

Management and staff of Execution Noble will remain "significant" shareholders in the business, including Execution founder Nick Finegold and Macpherson.

It is thought Lloyds Banking Group, which inherited a 10 per cent stake in the firm when it took over HBOS, will sell to BESI.

Macpherson said the tie-up with BESI was a "second stage", boosting Execution Noble's capital in order to underwrite and trade equities as well as expand its research operations in India, a key part of what Noble brought to the group.

BESI has been in talks with the investment bank since last autumn after the Portuguese firm sold its stake in London-based broker Evolution; a deal for which Finegold acted as an adviser.

Macpherson said BESI's offer, one of a number the group was considering, was "by far the most attractive" as it brought together the combined group's operations in emerging markets such as India, Brazil and Hong Kong.

Macpherson said: "We really do have the foundations of something that will be built up."

BESI chief executive Jose Maria Espirito Santo Ricciardi will become chairman of the group. Finegold will become vice-chairman alongside Luis Luna Vaz, currently BESI global head of capital markets.

Execution chief executive Simon Brookhouse will continue as the new group's chief executive. Macpherson will remain an executive board member, along with former Noble finance director Charles Ashton and Paulo Araujo from BESI.

Ricciardi said the deal would "preserve the individuality" of Execution Noble.

The deal will create an investment banking group with a headcount of close to 1,000 and will add BESI's offices in Lisbon, Madrid, Sao Paulo, Dublin and Warsaw to Execution Noble's offices in London, Edinburgh, Frankfurt, Mumbai, Hong Kong, New York, Boston and Greenwich in Connecticut, US.