In the current economic climate, which has seen most big initial public offerings (IPOs) on hold or cancelled, Norton Rose's targeting of the lower-end securities market has come good.
In the last two months it has closed four AIM fundraisings for a mixture of brokers and issuers (see box). The downturn has been evident since the end of the first quarter, but according to US-qualified partner Richard Baumann, Norton Rose has continued to pull in the work.
The latest research by The Lawyer suggests that he might be right. For the year ending June 2001, Norton Rose upped its profile, coming in second only to Linklaters in terms of volume for official listing for issuers and is ahead of Linklaters in the number of instructions it has received from the banks.
Admittedly it comes lower in the pecking order when it comes to value of deals, but it is still well within the top 10.
On the investment trust side, Norton Rose has a strong relationship with HSBC, where it has to vie for work with the bank's other preferred adviser, IPO market leader Linklaters. And, of course, it is also one of a number of firms – which includes CMS Cameron McKenna, Memery Crystal, Taylor Joy-nson Garrett and Gouldens – instructed by Collins Stewart.
But even more interesting is Norton Rose's recent success in relation to AIM floats. The team, led by Tim Marsden, has managed this because of its relationship with the non-investment trust market, leveraging off relationships with WestLB, WestLB Panmure and Charles Stanley.
With the exception of new issues by investment trusts, the last 6-12 months have been pretty lean for listing on the official list. But Richard Sheen, corporate finance partner at Norton Rose, claims that against this backdrop AIM has provided a number of opportunities for the firm.
He commented: “These opportunities have stemmed from our close relationships with some of the more active brokers operating in the AIM sector, and with the entrepreneurs who are behind a number of the launches.”
Corporate finance partner Mark Lloyd Williams said that, traditionally, Norton Rose has a broader spread than its competitors. “We act for both the banks and the company, and because we understand where the banks are coming from, we're used as issuers' counsel as well,” he said.
Certainly, Norton Rose is more balanced in its spread of work than most of its competitors, although it still veers towards advising the banks. On the issuer side, however, it has advised on the launch of a number of investment trusts. This year, listings on the official list include BFS US Special Opportunities Trust, Britannic UK Income Trust, LeggMason Investors Strategic Assets Trust and Royal London UK Equity & Income Trust.
It also advised EasyJet on a follow-on equity offering expected to raise more than £90m. Baumann and Lloyd Williams advised EasyJet on its IPO in London and New York last November, but the second equity offering is particularly impressive given that it is an airline deal taking place post-11 September.
In last year's IPO survey, Norton Rose came second in respect of total volume of UK IPOs, although it was outside the top seven in terms of value. In the AIM survey, in was the fourth-largest adviser to the corporate finance houses by value, but outside the top seven in terms of volume. It was also listed tenth as adviser to issuers by volume. So res-ults from the last year suggest that it is not just the partners making the noises, but that the practice really is on the up.
Norton Rose has had a US securities group for two and a half years, with two US-qualified partners in London. Baumann said it is easier to attract deals driven by the US market. Indeed, in the last two years, Norton Rose has advised on a number of deals with a US element. As well as EasyJet, the firm has also advised on Rule 144A tranches sold into the US for JP Morgan Securities, Dres-dner Kleinwort Wasserstein, Collins Stewart and HSBC.
Baumann may well say that the US element allows the firm to bring in some of the more high-profile deals, but only time will tell. The market is expected to pick up next year; only then will the pressure really be on.
|Norton Rose AIM deals closed in November and December|
|Issuer||Adviser to issuer||Adviser broker||Adviser to broker|
|Coliseum||Addleshaw Booth||WestLB Panmure||Norton Rose|
|Peerless Group||Norton Rose||Numis Securities||Norton Rose|
|Zincox Resources||Stringer||Charles Stanley & Co||Norton Rose|