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Predators move to `cherry pick' Hambros

Nigel Cope
Thursday 04 December 1997 00:02 GMT
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The independence of Hambros Bank was hanging in the balance last night when it admitted it had received approaches that could lead to a sale of all its banking operations.

Nigel Cope, City Correspondent, looks at the implications for the former blue-chip name now fallen on hard times.

Hambros said it had received "a number of expressions of interest" from groups interested in acquiring all or part of Hambros Bank following the appointment of Schroders last month to conduct a review of its performance and operations. It is also negotiating with Belgium's largest bank over the sale of its corporate lending business. It said it was reviewing these approaches and that "any offers for Hambros Bank would be judged against the value which the board believes could be delivered for shareholders from the continued ownership of Hambros Bank."

Predators are circling Hambros trying to "cherry pick" the most valuable assets, which include the private banking division and the corporate finance side.

However, Hambros stressed that the discussions were not for the whole group and did not involve the estate agent Hambro Countrywide, Hambros Group Investments or Hambros' stake in Guinness Flight Asset Hambro Management. But the sale of all or the best parts of the banking arm would signal the break-up of the group as this is its cultural and financial heart.

Hambros is in exclusive negotiations with Belgium's Generale de Banque over the sale of its corporate lending business where Hambros has been struggling to compete with the larger banks. A deal is expected in the next few weeks. Generale de Banque is keen to expand in Britain where it has around 70 staff in London. It is understood to be keen to strengthen its investment banking operations ahead of European Monetary Union in 1999. Hambros shares closed 1.5p lower at 265.5p valuing it at pounds 470m.

Hambros has had a terrible year in which its name was tarnished by its involvement in Andrew Regan's unsuccessful break-up bid for the Co-op. The 160-year old bank has been lambasted by shareholders for poor management and under-performance.

One banking analyst said: "It will not be mourned. Why should it be. It is an anachronism and the people who run the bank have not developed it. They will be able to spend more time riding to hounds."

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