There could be changes afoot at Barclays (BARC) as famed activist investor Edward Bramson takes a 5.2% holding in the company.

Bramson’s investment vehicle Sherborne Investors (SIGC) paid around £580m for the stake.

Previously he has been involved with private equity firms 3i (III), fund manager F&C Asset Management and Electra Private Equity (ELTA). He managed to realise £1.5bn in cash for shareholders of the latter, although Barclays represents a significant step up in terms of the scale of the business.

Given that the bank’s shares are trading on approximately 0.79 times price to book, a discount to the majority of the peer group, Bramson is likely spying an opportunity to close the gap.

Chief executive Jes Staley, who had a stellar reputation at best in class investment bank JP Morgan, was brought in to restore the fortunes of Barclays.

A recently announced doubling of its ordinary dividend per share payout to 6.5p may have helped appease shareholders but the continuing underperformance of its investment banking division, Staley’s specialism, is still a concern for the market.

Barclays’ shares rallied on news of Bramson’s involvement in the bank although it is worth noting certain issues like the fraud investigation into its funding deal with Qatar in 2008 and a fight with the US Department of Justice over the mis-selling of mortgage-backed securities are largely beyond its control. (DS)

‹ Previous2018-03-22Next ›