Mishcon De Reya joins forces with Arkios

Mishcon Corporate Finance, the corporate finance arm of Mishcon de Reya has merged with corporate finance boutique Arkios Limited. The newly merged group will retain the Arkios name. Mishcon invested in Arkios in September, taking a 50 per cent stake in the firm. Mishcon’s chairman, John Jackson has become chairman of Arkios and the firm’s managing partner Kevin Gold and corporate partner James Wilcox have also joined the board.

The pooling of both firm’s advisory and execution skills will enable Arkios to broaden the scope and scale of corporate finance services that it offers to emerging companies across Europe, says James Wilcox.

Charles Nettlefold, Simon Abel and Richard Bryant who had previously worked together at BNP Paribas established Arkios in August 2001. The group’s core business proposition is raising equity capital for unlisted companies in the £5 million to £50 million range. Arkios also provides related services that include advice on M&A, buyouts and general strategy, raising debt finance and assistance with commercial development and partnering.

There are some good opportunities out there, says Richard Bryant. “There have been some withdrawals, suspensions of deals within various groups, but there is still a lot of capital waiting to be invested – it’s a case of finding the right opportunities. Most of the deals we are seeing now are of a higher quality – those that are weaker have fallen by the wayside.”

M&A deals are down, but the group does see opportunities at the lower end of the M&A scale with VCs who have portfolios that need to be restructured. But from a core competence of raising capital for expansion for businesses, the most logical development is on the buyout side, says Bryant. “That is where most of the additional firepower will go. M&A is going to be more ad hoc.”

A rough estimate of business allocation is between 50 per cent and 60 per cent on capital raising, 30 per cent to 35 per cent on private equity and buyout transactions and the balance will be ad-hoc M&A transactions.

The firm has also added a new dimension to the business with the appointment of Johan Schutte from Merrill Lynch’s media team to set up a new company called Dextrae, of which Arkios owns 50 per cent. The idea is that Schutte will concentrate on media transactions for Dextrae. This will also serve as an extra source of deal flow for Arkios as any opportunities will automatically pass through the Arkios gateway.

Bryant hopes to mirror this business structure in the future as the group expands with a focus on specialist sectors such as biotech and healthcare.