Panmure agrees Durlacher takeover

Tim Linacre and Richard Wyatt, the chief executive and chairman of the brokers Panmure Gordon, will each receive a stake of up to 5 per cent in the company after it completes its merger with smaller rival Durlacher.

Tim Linacre and Richard Wyatt, the chief executive and chairman of the brokers Panmure Gordon, will each receive a stake of up to 5 per cent in the company after it completes its merger with smaller rival Durlacher.

The companies announced yesterday that final agreement had been reached on the terms of the merger, with a circular being sent out to shareholders early next week.

The document will show that Mr Linacre and Mr Wyatt will have equity stakes that will be worth at least £3m each and which could be worth significantly more once the enlarged group starts trading on AIM.

Durlacher's existing shareholders will receive about one-third of the newly created group and nearly 35 per cent of them have expressed their support, including its biggest investor. Another third will be owned by Lazards, Panmure Gordon's parent company, and one-third will go to management and employees. Mr Linacre will earn a relatively modest City salary of £175,000 as chief executive while Mr Wyatt will earn £150,000 as executive chairman.

The pair will be able to subscribe for 436,365 shares each if the company has a market value of £60m for five consecutive stock market trading days. Most analysts believe the company is almost guaranteed to have this value when it starts trading after it gains shareholder approval.

They will be able to subscribe to the same number of shares again if the market value of the company is £90m over five consecutive trading days.

Optimistic forecasts suggest the group could have a market value of nearer £100m.

In a statement the two men said: "We are particularly pleased at the level of support we have received from Durlacher's shareholders and the clients of both firms. This is a value-enhancing combination which creates a leading UK corporate and securities business."