Deutsche Bank is set to upend the UK investment banking landscape after completing the £410m acquisition of City broker Numis, which will create a team of 155 dealmakers focused on the country.
The German lender has unveiled ‘Deutsche Numis’, the rebranded combined entity, which seems certain to shake-up the UK investment banking league tables as the City’s biggest broker is handed the balance sheet of a bulge bracket bank.
Deutsche Numis will have 170 corporate broking clients and the acquisition will bolster its UK dealmaking team from 35 people to 155 investment bankers.
Deutsche is making a renewed push into investment banking after a three-year overhaul that planned to reduce headcount by 18,000 people. This year, it has hired 50 senior dealmakers and was one of the many investment banks to take advantage of the demise of Credit Suisse to bring in talent.
Deutsche wants a bigger share of the M&A fee pool, but the Numis acquisition will also bolster its equity capital markets unit. Meanwhile, Deutsche aims to give Numis the financial firepower that will boost its corporate finance unit beyond its traditional strengths in corporate broking and ECM.
READ How Deutsche Bank wants to upend the City pecking order with its Numis deal
Alex Ham and Ross Mitchinson, co-CEOs of Numis, will retain the same roles at the combined entity. They will report into Henrik Johnsson, co-head of investment banking for Europe, the Middle East and Africa at Deutsche Bank. Luke Savage, who is a former chair at Numis, will remain on the board.
James Taylor, who leads Numis’s investment banking business, and Daniel Ross, head of UK investment banking at Deutsche Bank, will co-head the Deutsche Numis dealmaking team.
Fabrizio Campelli, head of Deutsche Bank’s corporate bank and investment bank, said the deal would allow the bank to “expand our reach amongst UK and international corporates in Europe’s largest investment banking market, and underlines our long-term commitment to the UK”.
“Deutsche Numis is now a leading force in UK investment banking, building on a long track record of providing innovative financial advice and solutions for ambitious public and private companies, and investors doing business in the UK,” Ham added in the statement.
The UK investment banking fee pool typically makes up around 25-30% of the European revenue wallet and is key to gaining market share in the region. Deutsche has ambitions to be the leading European investment bank in the region, meaning that it would need to break into the top six to displace Barclays. It currently ranks 12th in Emea, according to data provider Dealogic.
Key to the success of the takeover will be retaining Numis employees; M&A deals among investment banks often lead to talent heading for the door. Numis is the biggest City broker, but remains small compared to Deutsche and the German lender will have to work to retain Numis’s culture, Financial News has previously reported.
Deutsche’s UK investment banking team will move into Numis’s office on Gresham Street in a sign that the German lender is working to minimise staff disruption.
Campelli told FN previously that a presence in corporate broking was “critical to our ambitions” in the UK, as around 95% of M&A transactions and 100% of ECM deals in the country are assigned to corporate brokers.
“By not having a strong corporate broking business and building it out organically we were missing out on an opportunity to capture that flow by default,” he said.
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