Indosuez Capital Presses Onward –

Credit Agricole Indosuez, the capital markets and wholesale banking arm of the Credit Agricole Group, is reshuffling one of its divisions, Indosuez Capital, the merchant banking and asset management arm, in light of the mass defection of several key bankers and staff personnel.

Former co-heads Ken Kencel and Daniel Smith left Indosuez Capital last month for RBC Dominion Securities‘s newly formed leveraged finance arm, RBC Leveraged Finance, leaving Indosuez’s top positions vacant (Buyouts Oct. 22, p. 1). Indosuez Capital recently countered the move by announcing four new managing directors that will spearhead the bank’s operations.

Thierry X. de Vergnes, formerly an Indosuez vice president, has assumed the role of managing director and head of Indosuez Capital Merchant Banking. Another former Indosuez vice president, Richard Jacobson, has been promoted to the role of managing director. Prior to joining Indosuez, Jacobson served as vice president in the leveraged finance group of SG Cowen Securities.

Also, former Indosuez principal William Ziglar has been promoted to the position of managing director.

Not restricting itself to promoting from within, Indosuez also attracted Paul Travers from Bear Sterns & Co. to assume the role of managing director and head of Indosuez Capital Asset Management.

“We are very strongly committed to the merchant banking and asset management business, which has been around for nine years,” said de Vergnes. “In fact, just as recently as August, Credit Agricole has allocated more capital to its activities.”

Ziglar added that the bank’s brand name did not leave with its former employees. “It takes a long time to build a franchise and franchises don’t disappear because people walk out of the door,” he said.

Travers said he feels comforted by the level of commitment from his new partners. “I would not have made such a career move if I didn’t believe there was a tremendous commitment to the business here,” he said. “Thierry, Richard and Will have given me great comfort that they want to be here, and will be here, to help me build the business.”

Travers admitted that the bank has been getting calls from its institutional investors “with natural concerns,” and the bank has reassured them that the bank is carrying on with its daily business routine without interruptions.

The damage control effort spearheaded by the new Indosuez team seems to have a soothing affect on some of its financial sponsor relationships. Robert Newbold, a principal at Graham Partners, which invested alongside Indosuez Capital in the Eldorado Stone deal, said it should be business as usual between the two groups. “We had just met over the phone the person who was going to be our new contact person and he basically said Credit Agricole’s commitment to Indosuez Capital was a good investment and the bank was 100% behind the investment,” Newbold said.

Newbold added that he has been in contact with the former Indosuez bankers at RBC Leveraged Finance, and is encouraged that there are more lending sources in the middle market. “We’re seeing so much consolidation among middle market lenders now that it is nice to have a little bit of choice with new groups joining and new capital.”