Cavendish shares eye year high after rejecting deals unit takeover
Shares in investment bank Cavendish spiked on Tuesday as the firm confirmed it had rejected takeover interest in its deals unit after facing private equity-backed interest.
Cavendish had been approached regarding a deal that would break up the London-listed investment bank by Smith and Williamson (S&W).
The value of the offer remains unclear, Sky News reports.
But the firm shot down speculation Tuesday morning telling the markets it had received interest in its deals unit which was rejected.
Shares spiked 15 per cent in the mid-morning after the news broke hitting 12.88. This neared highs of 14.30 last July.
The financial services firm said there had been no further discussions on the matter.
Cavendish swung back to profit in November
The investment bank was birthed as a result of a £43m merger between Finncap and Cenkos Securities in 2023.
The firm returned to profit in November after a 42 per cent year-on-year jump in revenue to £27.7m.
Profits reached £1.8m for the six months to September 30, compared to a £3.6m loss for the same period last year.
“The group’s strategy is to focus on growing and evolving as a full service, fully integrated, small and mid-cap investment bank with the potential for adding additional business offerings rather than reducing them,” Cavendish said on Tuesday.
“Cavendish has already generated significant revenues and won a number of live mandates as a result of the integrated business offerings within the Group.”
The group has been vocal on Budget-related uncertainty since Chancellor Rachel Reeves Autumn tax hikes.
In November, the firm said Reeves’ decision to only partially abolish the inheritance tax break on AIM shares “recognises the vital role played by this market in the UK’s economic growth and removes any uncertainty about its future”.
Julian Morse and John Farrugia, co-chief executives of Cavendish, said at the time: “Our profitable first half, in both public and private markets, demonstrates the broad appeal of our service offering and the efficiency of our platform. We have a solid pipeline of both public and private transactions in train including a number of potential IPOs.”