Barclays prepares to fend off possible Bramson attack

Activist investor has built up 5% stake

Edward Bramson

• Investment Week

Barclays Bank is understood to be drawing up plans to help defeat a possible attack from activist investor Edward Bramson of Sherborne Investors, who has built up a 5% stake in the lender, The Telegraph reports.

According to the paper, Barclays chiefs have conducted research on Bramson's past tactics, after consulting with City figures who have had contact with the investor in the past.
They are understood to have built up contingency plans with advisers at Deutsche Bank and JPMorgan.
Jes Staley, Barclays CEO, is also prepared to meet Bramson if a meeting is requested, while the group is confident it can hold off any attack by Sherborne. Barclays declined to comment on the story.
It was revealed last week that Bramson, who founded Sherborne Investors, has taken a 5.2% stake in Barclays, which equates to £580m in shares and derivatives and puts it on the list of top five shareholders.
In a statement, Sherborne said: "Sherborne Investors has advised the company that its turnaround assumptions indicate a potential return on the investment in line with Sherborne Investors' customary return objectives."
Bramson has not yet revealed his plans for the bank, but speculation has been building that a break-up or restructuring is on the cards. This could include spinning out the investment bank or selling its US cards business, The Telegraph reports.
The investor has a history of activism in financial services companies. For example, he began building a stake in the Electra investment trust in March 2014 and joined the board in 2015. He then became interim chief executive in May 2016 and implemented a number of changes on the vehicle.
Bramson also previously held a 19% stake in F&C (now BMO Global Asset Management) and was chairman of the board. During his time, he made a raft of cost-cutting measures that helped to improve profits. 
Russ Mould, investment director at AJ Bell, said: "Sherborne has built a formidable reputation for squeezing improved financial and operational performance from the companies in which it invests and Bramson clearly feels that Barclays shares are going cheap, given the prevailing discount to the book, or net asset value.
"The question now is what the activist investor thinks Barclays should be doing differently and how he intends to get those views across to the bank's boss, Jes Staley."