Numis heads North in search of IPOs

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Institutional stockbroker Numis Securities is opening an office in the North of England, as it aims to play a bigger role in corporate activity in Yorkshire.

Oliver Hemsley, the chief executive of Numis, said he didn’t believe the North could be served from an office in London.

Numis has hired Graeme Summers as managing director of corporate broking. He will lead the company’s new Northern office in Manchester, which will have five staff.

Mr Hemsley added: “There’s a lot of growth in the North and we want to be part of it and service it. It was an obvious move for us to have a base in Manchester. It seems the most logical place to start.”

Although there were no plans for a Leeds office, Mr Hemsley said that Numis “didn’t rule anything out”.

He added: “We want to consolidate our position in the North. We don’t think we can do that remotely.”

Mr Summers spent two decades at rival broker Brewin Dolphin. This year, Numis has been involved in the flotations of Doncaster-based Polypipe, which is one of Europe’s biggest manufacturers of plastic pipe systems, and Leeds-based Clipper Logistics.

Numis’s competitors in the North of England include Zeus Capital, which also has an office in Manchester. In September, Zeus hired Sir Nigel Knowles, the managing partner of law firm DLA Piper, as its chairman.

Dr Iain Clacher, an associate professor at Leeds University Business School, said Numis’s decision to open a Manchester office, coupled with the growth in the number of regional initial public offerings (IPOs) such as Clipper and Polypipe, suggests that large corporate transactions are starting to surface in the regions.

He added: “It may be the start of more regional offices being opened in places like Manchester and Leeds, which are major financial and professional services centres.

“The issue is whether this is a short-term blip, or a long-term trend. Markets are volatile and corporate activity is sporadic.

“We have seen a number of big IPOs withdrawn in the past few weeks such as the property firm Urban Exposure, the car auctioneer BCA Marketplace, and the bank Aldermore. There is a growing concern that markets are overvalued as a result of the amount of money that has been sitting on bank balance sheets because of quantitative easing.”

If this is the case, then Mr Clacher fears that corporate activity may fall off a cliff as QE ends and interest rates rise.

He added: “In this scenario, there will be no investor appetite for new shares, which decreases the need for offices outside of London. However, London is hugely expensive. There may be a demand for more affordable business locations that still bring credibility in the corporate world, and so regional offices, in places such as Leeds and Manchester, may be an attractive prospect in the longer-term.”

Last year, Panmure Gordon opened an office in Leeds and hired corporate financier Joanne Lake to head its investment banking and stockbroking operations in the city. Ms Lake, a past chairman of lobby group Financial Leeds, said today: “There are relatively few brokers competing on the ground in Yorkshire and the North West and Panmure Gordon is the most long established firm with offices in the regions, with teams in both Leeds and Liverpool. We know our clients appreciate the local presence and support, and we will expand our teams as we continue to grow our client-base across the North.”