Former type Public Fate Acquired Headquarters London, United Kingdom Successor Swiss Bank Corporation Ceased operations 1995 | Industry Banking Defunct 1995 Founded 1946 Number of employees 6,000 | |
Key people Sir Siegmund George Warburg, (Chairman) | ||
S. G. Warburg & Co. was a London-based investment bank. It was listed on the London Stock Exchange and was once a constituent of the FTSE 100 Index. The firm was acquired by Swiss Bank Corporation in 1995 and ultimately became a part of UBS.
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Founding and early history
This bank was founded in 1946 by Siegmund Warburg, a member of the Warburg family, a prominent German-Jewish banking family and Henry Grunfeld, a former industrialist in the German steel industry. Warburg and Grunfeld, who was also Jewish, had fled Nazi Germany in the 1930s.
S.G. Warburg and Co. was recognized for its pioneering mergers and takeover work in the UK in the 1960s, including the first ever hostile takeover in the UK and the first ever Eurobond issue, which fostered the new Eurodollar market. A significant event in the firm's rise to prominence was the acquisition of Seligman Bros. in 1957; through this, Warburgs gained a place on the Accepting Houses Committee composed of the seventeen top merchant banks with access to cheap capital backed by the Bank of England.
The period 1958/9 saw the Aluminium War when Tube Investments, advised by S. G. Warburg & Co, fought a fierce and ultimately successful battle to acquire British Aluminium.
1960s, 1970s and 1980s
The bank gained clients and grew rapidly in the 1960s and 1970s, its strong work ethic and rigorous intellectual culture standing in stark contrast to the gentlemanly and clubbable milieu of the traditional City houses.
In the early 1970s, S.G. Warburg entered into a U.S. joint-venture with Paris-based Paribas (Banque de Paris et des Pays-Bas, prior to the bank's nationalization in 1982) named Mercury Securities. In 1974, S.G. Warburg and Paribas took a 40% interest in A.G. Becker & Co., a U.S. based brokerage. Although the joint-venture initially provided an international dimension for its three members, the relationships soured in the late 1970s and early 1980s. The joint-venture was plagued by competition between Warburg and Paribas, as well as cultural conflicts between French, English and American executives. Although Warburg had originally planned to buy out Paribas, after Siegmund Warburg's death, Paribas bought out Warburg's interest in the joint venture in early 1983. Following the departure of Warburg from the joint venture, the firm was renamed A.G. Becker Paribas.
A major participant in the "Big Bang" reforms of the 1980s under the leadership of its Chief Executive Sir David Scholey, it acquired stockjobber Ackroyd & Smithers, stock broker Rowe & Pitman and the government gilt broker Mullens & Co. The bank became the preeminent UK-based M&A adviser, equity underwriter, research house and (via its Mercury Asset Management subsidiary) asset manager by the early 1990s, employing some 6,000 people worldwide.
Purchase by Swiss Bank Corporation (1995)
Following another flawed and costly expansion into the US, in 1994 a merger was announced with Morgan Stanley, but the talks collapsed.
The following year S.G. Warburg was purchased by Swiss Bank Corporation. Swiss Bank Corporation merged S.G. Warburg with its own existing investment banking unit to create SBC Warburg, which became a leading player in global investment banking. In 1997, SBC Warburg was merged with U.S. investment bank Dillon, Read & Co. to create Warburg Dillon Read.
After the merger of Swiss Bank Corporation and Union Bank of Switzerland in 1998, Warburg Dillon Read was renamed UBS Warburg. The Warburg name was finally retired in 2003 when the investment banking operation of UBS was renamed UBS Investment Bank.