Barclays doubles stake in Australian investment bank Barrenjoey

Barclays has doubled its stake in Barrenjoey to almost 20 per cent after it paid A$75mn ($53mn) for new shares in the Australian investment bank that is rapidly expanding its financial services range.

Barrenjoey, which means “young kangaroo”, was launched in 2020 and backed by Australian fund manager Magellan and Barclays.

Since then the Sydney-based bank has hired 300 staff, poaching from rivals including UBS, to tap into a dealmaking boom in Australia.

Barrenjoey has advised on A$47bn worth of deals in the year to date, putting it at the top of the M&A league table above its more established rivals such as UBS and Credit Suisse, according to Dealogic data.

Barclays’ capital injection means it will own 18.2 per cent of Barrenjoey, up from an initial 9.9 per cent, to give the Australian bank a valuation of A$750mn.

Barclays, which has a standalone office in Sydney, has worked with Barrenjoey by providing its clients with access to about $10bn of financing related to the Australian deals.

Barrenjoey is expected to use the new funds to boost its regulatory capital and invest in its markets division. Its fixed-income derivatives and equity financing products are due to launch in the next six months.

“Our strategic partnership with Barclays has been instrumental to our early success, leveraging their global investment banking and securities franchises and balance sheet for the benefit of our clients,” said Brian Benari, chief executive of Barrenjoey.

The two banks have worked in tandem on a number of deals in the past year. Barrenjoey acted as lead adviser on Morrison & Co’s A$2.8bn purchase of a stake in Telstra’s towers business, while Barclays acted as underwriter and bookrunner on a A$1bn financing for the bidder.

Barrenjoey was an adviser to Brookfield on its A$18bn takeover of electricity transmission company AusNet Services, with Barclays organising A$2bn in bridge financing. The two banks also acted as joint advisers on Brookfield’s sale of a 50 per cent stake in the Port of Geelong.

Both Barclays and Magellan, which has suffered a collapse in funds under management this year after wealth manager St James’s Place switched its business to a rival company, have almost 5 per cent of the voting rights.

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