Barclays Loses IAG Brokership, Misses $3.3 Billion Share Sale

(Bloomberg) -- Barclays Plc, which has been enjoying one of its best ever runs on U.K. stock sales, has lost a key FTSE 100 client and missed out on one of the biggest deals of the year so far.

British Airways owner IAG SA has chosen Morgan Stanley to replace Barclays as joint corporate broker, alongside Deutsche Bank AG, according to the company’s website. Barclays had been a broker to IAG for around a decade. IAG also didn’t name the U.K. bank on its list of advisers for a 2.75 billion-euro ($3.3 billion) rights offering announced Friday.

Representatives for Barclays and Morgan Stanley declined to comment. A representative for IAG confirmed the change and declined to comment further.

Corporate brokers provide go-to advice to U.K.-listed companies on everything from strategy to shareholder engagement for a nominal fee in an effort to secure more lucrative roles on capital market transactions and acquisitions. As such, broker roles are highly contested in the U.K. and the switch at IAG has quickly benefited the new line-up.

The airline group is raising new equity to help it ride out the coronavirus crisis. Deutsche Bank, Morgan Stanley and Goldman Sachs Group Inc. were listed as underwriters on the share sale, according to a statement. Rothschild & Co. worked as an adviser.

There was no role for Barclays, which has been on a hot streak for such deals in 2020 thanks in no small part to the strength of its corporate broking relationships. Companies including Compass Group Plc, SSP Group Plc and WH Smith Plc have all turned to the bank for emergency fundraisings amid the pandemic.

This has put Barclays on course to top the annual rankings for equity offerings in the U.K. for only the second time in two decades. Equity capital markets revenue at the bank rose by almost a third during the first half, according to its latest results.

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