08 Nov 2012
Sunrise Brokers, best-known as a equity derivatives broker, has hired the former head of equity capital markets execution at Deutsche Bank to launch a corporate finance business focused on small and mid-cap companies, Financial News can reveal.
Gilles Ohana, who was registered as inactive on the Financial Services Authorityregister of authorised staff in late August, will join Sunrise as a partner in December.
A veteran ECM banker, Ohana previously spent 12 years at Deutsche Bank, most recently as head of ECM execution. He has worked on share sales for the likes of Russian real estate company AFI Development, Polish miner KGHM and Russian bank VTB Group.
Ohana told Financial News: “Sunrise is well known as a financial services provider. We think it is a natural step for the firm to move into corporate finance and operate as an independent adviser across the whole product suite.”
Sunrise is a long-standing market leader in brokering exotic equity derivatives to banks and buyside firms, but started life as interdealer specialist in the structured equity products market. More recently it has been targeting an increasing amount of business from fund managers.
Under the leadership of chief executive Claude Amar, the firm has expanded rapidly into a full-service, multi-asset broker and, with the addition of a corporate finance function, is beginning to look similar to a boutique investment bank.
The primary focus of the corporate finance unit will be equity and debt capital markets for small and mid-cap companies, with Sunrise planning to build the business in Europe, the Middle East and Africa, before rolling it out across the US and Asia.
The company will run what is effectively a capital-light, research-light unit, and will not offer underwriting on equity capital markets transactions. Instead, the business will focus on providing access to investors during initial public offerings and, on deals where there is underwriting involved, independent equity advice.
The model, according to Ohana, delivers “the best of investment banking and independent advisory”.
He added: “Research has been commoditised, and so we plan to be as flexible as possible in that regard, assigning analysts to the stocks which we bring to market rather than having a room full of analysts sitting on their hands covering stocks where there is no hope of activity.”
Equity capital markets activity has been muted through 2012, as low valuations and a period of extended volatility have put paid to a number of planned IPOs. However, there is a universe of small and mid-cap companies which need finance, whether it is equity or debt, and which are “less price sensitive”, according to Ohana.
He said: “We hope to connect those companies with investors, help raise their profile and help them issue equity or raise debt through the private placement market, for example.”
Financial News reported earlier this week that Sunrise had hired Daryl Bowden, one of the founding partners of boutique brokerage Execution and most recently head of sales trading in Europe at Macquarie, as a managing director in equities.
In addition, the firm this week launched a suite of specialist equity research tools focused on the cash markets, including quantitative, technical and fundamental analysis tools. Denis Kan has joined from Royal Bank of Scotland to lead the quantitative analysis effort.