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Does Matheson's exit pave way for Brewin Dolphin bid?
by Dylan Lobo on Mar 21, 2013 at 14:46
Others were more suprised by the news, including housebroker RBC Europe, which was supportive of the move.
'We are surprised as Mr. Matheson is synonymous with Brewin Dolphin,' said RBC analysts Peter Lenardos and Portia Patel in their note on the stock.
'[However] We are pleased that (i) the roles of chairman and CEO have been split, (ii) the board has been downsized, and (iii) the board will soon become fully compliant with the UK Corporate Governance Code. We believe today’s statement lends credibility to the company’s operating margin expansion plan.'
Taking out the possibility of a bid, Price was less bullish on Brewins prospects.
'We still believe that the risk to Brewin’s stated strategic review, and its related aims (adjusted operating margin of 20% by FY’15, for example), remains on the downside,' Jones said.
'We, therefore, remain sellers of Brewin Dolphin’s stock this morning and our previous reasoning remains intact given the re-pricing of its back book, the transition to entirely new IT systems internally across its office network of circa 41 and the risk of double running costs that this implementation brings.'
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