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Investec Plc still reeling on share raising venture PDF Print E-mail
Written by Sam Coventry   
Wednesday, 04 August 2010 09:21



Markets don't like surprises, so when Investec went to the market looking for more cash it was sold off aggressively.


Investec was one of the FTSE 100's worst performers over the past 24 hours after it took the market by surprise with an unexpected capital raising.

The South African investment bank defended its move by saying the fund raising was an attempt at shoring up its Tier 1 capital ratio's, without reducing the bank's total capital adequacy ratio..

Investec was said to have raised £104.5m by placing 22m new shares at 475p.

The shares dropped 28.3 to 475.2p as dealers were caught off guard by the move.

Investec face another headache in the form of investor group PIRC.

The activist group urging shareholders to oppose the election of a number of non-executives at next Monday’s AGM in the City of London. It goes without saying that it is recommending opposition to the board’s remuneration report too.

PIRC points out that there is a complete lack of independent representation on the Investec board. It’s like an old boys club, it says. The board is full of South Africans who have known each other for donkey’s years.

Samuel Abrahams is not considered independent as he has been on the board for 13 years, while Ian Kantor is not only a former chief executive but is also the brother of the managing director and has also been on the board for more than 30 years.

Richard Thomas has been on the board for more than 29 years, and Fani Titi was previously the chairman of Tiso Group, which has a material relationship with Investec.

Bradley Field was previously the chief executive of Investec Bank and an employee of Investec. All very cosy.
 

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