Shell-shocked Cazenove closes ranks

THE Queen's stockbroker Cazenove is battening down the hatches after the shock departure of deputy chairman David Verey and dwindling hopes of a takeover by one of its bigger rivals. It is sticking to its hopes of a share float by April 2003 but the £1.5bn value once talked of now seems highly optimistic.

Brokers put Verey's departure down to clashes of 'culture', especially with new chief executive Robert Pickering. and to a need for the 179-year-old group to concentrate on business-getters in difficult markets.

Cazenove's value today is probably well south of £1bn. Spearheaded by veteran chairman David Mayhew, it remains a formidable force in new share issues and advice.

It handled some of the biggest and best performing recent floats, such as William Hill and John Wood Group. It creditably warned last year of the impending 'split capital' disaster. But its fund management side, which had £11bn under its wing last year, has had persistent problems.

Cazenove partners must look with envy at rival Robert Fleming, which sold itself to US banking giant Chase for an eye-watering £5bn. It has little choice but to plough ahead with float plans, having started the clock 16 months ago by raising £200m in shares and debt from City funds. It lifted the veil of secrecy at the time by disclosing nine-month revenues of £297m and pre-tax profits of £86m. But that was before markets crashed.