Babcock and Brown
 |
|
| Public | |
| Traded as | ASX: BNB |
| Industry | Real Estate, Infrastructure & Project Finance, Structured finance, Private Equity, Corporate Finance, Operating leasing |
| Fate | Liquidation |
| Founded | 1977 |
| Defunct | August 24, 2009 |
| Headquarters | Sydney, Australia |
|
Key people
|
|
| Products | Listed property funds, Listed infrastructure funds |
| Revenue | A$1.29 billion (2006) |
|
Number of employees
|
1,000 |
| Website | www |
Babcock & Brown was a global investment and advisory firm based in Sydney, Australia that went into liquidation in 2009. It was best known in financial markets for structured finance deals. The company had at its peak 28 offices and over 1,500 employees worldwide. Although headquartered in Sydney, it had a significant presence in Europe and the United States. The creditors of Babcock & Brown voted to place the company into liquidation on 24 August 2009.
At the end of 2008 Babcock had a market capitalisation of just over $8.5 billion, and in 2007 its market capitalisation peaked at above $9.1 billion (A$33.90 per share). However, by October 2008 the share price had collapsed by 95% to A$1.30 and by December 2008 by 99.6% to A$0.14, representing a market capitalisation of less than $50 million. On 13 March 2009 the company was placed into voluntary administration. Approximately 45% of its shares were owned by the executives of the firm.
Nicknamed the "Mini Macquarie", it was a company frequently compared with larger competitor Macquarie Bank.
The Company was founded in 1977 by James Babcock and George Brown in San Francisco, USA. Babcock opened a Sydney office in 1982 and largely operated as a corporate advisory firm focused on leasing of aircraft and other equipment until the early 1990s. B&B entered the real estate market in Sydney, at that time enjoying considerable success. Jim Babcock resigned from the board of directors on 1 November 2008 citing personal reasons.
The company's focus from advisory work to investment management continued until a German bank Bayerische Hypo und Vereinsbank invested US$120 million in return for a 20% stake. It used those funds and third-party funds they raised from clients to invest directly in a wide variety of investments, as both co-investor and principal.
The investment firm latterly regarded its three business functions as financial advisory, principal investment on its own account, and funds management. It was a global business with 33% of its revenues coming from the United States, 31% from Australia, and 36% from Europe.
In 2005 its real estate group generated 36% of the company's net revenue. This division made investments on behalf of the company itself, and also of property-focused managed funds that it had organised. It had considerable success in property investments in Japan and Germany.
In infrastructure and project finance, an area in which Macquarie Bank is probably best known in Australia, it emerged as a significant investor in a range of power, transport, water and public-private partnerships (PPPs). Starting out in England with PPP projects, this part of B&B's business generated 24% of the company's net revenue. In 2004 it established Prime Infrastructure, an ASX listed infrastructure fund containing coal distribution and related assets.
...
Wikipedia