Insights

UK Corporate Broking: Set to outperform amid surge in equity issuances due to COVID-19

The COVID-19 pandemic and associated lockdowns have led to unprecedented market conditions, with economic activity coming to a near standstill in the UK. While sales have plummeted across sectors, financial commitments to vendors, staff and lenders still need to be honoured, depleting cash reserves and constraining liquidity. UK corporates have, therefore, resorted to emergency fundraising via large equity issuances to improve liquidity and capital positions. In the largest and most notable recent equity issuances in the UK, corporate brokers also functioned as joint global coordinators/joint book-runners in a highly competitive market.

This insights paper highlights the uniqueness of corporate broking services in the UK and their evolution. It also aims to analyse demand for corporate broking services in the UK since the start of the pandemic and the outlook for the industry in the UK. The positive outlook stems from supportive government regulations and the substantial increase in equity follow-on issuances due to emergency funding and prospective growth-related funding needs that have increased demand for corporate brokers.

Key Takeaways

• Corporate broking services continue to gain prominence in the UK due to regulatory
  and structural reasons.
• Demand for corporate broking services is likely to continue increasing amid the current
  uncertainty and supportive government regulations.
• Corporates have injected significant amounts of emergency funding so far in 2020 to
  boost liquidity and capital positions; they are also likely to raise more funds for growth
  and expansion, keeping corporate brokers busy.


Authors
Rohit Sharma

Rohit Sharma

Assistant Director, Lending Services

Rohit Sharma contributes over 15 years of diverse experience in lending services and investment banking. Currently leading a leveraged lending team supporting a reputable UK bulge bracket bank, he plays a crucial role in overseeing credit underwriting for highly leveraged companies. His expertise includes deciphering complex legal documents and ensuring compliance with regulatory requirements as per FED and ECB guidelines. As a seasoned professional, Rohit excels in assessing client creditworthiness, developing intricate credit pay-down models, creating credit reviews, and closely monitoring credit facilities.

His skills were refined in previous leadership roles where he led Equity Capital Market (ECM) and Equity Advisory teams. In this capacity, he supported senior investment bankers by contributing to investor decks for deal origination and execution. Moreover, Rohit played a key role in supporting onshore equity advisory teams, providing strategic counsel on clients' market impact and communication strategies. Before joining Acuity, he spent around two..Show More

Shreya Kaushal

Shreya Kaushal

Analyst, CPB

Shreya has been with Acuity ECM team since June 2020. Her current role requires her to handle assignments for bulge bracket investment banking client team on ECM & Corporate broking projects like industry research, investor targeting, ECM offering related case studies, benchmarking, corporate governance and block updates.

Prior to joining Acuity, she worked as an Audit Associate at Ernst and Young from Aug 2015 – Oct 2016, where she was working parallel with EY US Audit team and was responsible for performing General Audit procedures (Primary and others), preparing audit reports and schedules to be submitted to statutory body (SEC, PCAOB). Shreya holds PG Diploma in Finance from Birla Institute of Management Technology and Bachelor’s degree in Commerce from Delhi University.

UK Corporate Broking: Set to outperform amid surge in equity issuances due to COVID-19

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