Inside lane: how Barrenjoey cut in on UBS

Jemima Whyte and Michael Roddan

Updated Mar 16, 2021 – 5.42pm, first published at 5.14pm

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Barrenjoey Capital has joined UBS, Macquarie and Morgan Stanley as an adviser for Transurban’s potential buyout of WestConnex in the latest example of the upstart investment bank swooping in on the Swiss bank’s turf.

As well as cutting in on UBS’ mandate with a long-term and lucrative client, the new firm, run by chief executive Brian Benari, has poached its bankers, legal counsel Annette Spencer and, this week, top-rated analysts.

It’s even fighting it out for talent in the schools, launching a cadet program, just like UBS.

Transurban CEO Scott Charlton, right, and chairman Lindsay Maxsted have added Barrenjoey Capital as an adviser. Wayne Taylor

Barrenjoey, which has hired more than 200 people from rival banks since September, has said it is working on multiple advisory mandates, although it won’t begin trading equities until next month.

Rivals say it will need to pull in mandates fast to make up for the high cost base and the $400 million valuation at which Magellan Group invested.

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Tollroad operator Transurban’s decision to appoint Barrenjoey in an advisory capacity follows the appointment of Jarrod Key as a Barrenjoey partner.

Sources said Mr Key worked through his gardening leave, which is typically six months for UBS senior bankers, at the request of the Swiss bank. It wanted to please client Transurban, which wanted Mr Key to stay on the advisory team.

The client doesn’t care which firm the person works for; they are just going to call UBS and say: I want him.

— A source on how a top employee could consulted for UBS while on gardening leave on his way to Barrenjoey

Once that expired, Barrenjoey was added to the advisers and, a source said, UBS and Barrenjoey will split their advisory fees.

“The client doesn’t care which firm the person works for; they are just going to call UBS and say: I want him,” said one source, noting that hiring bankers on live deals opens the way for Barrenjoey to be added to mandates.

Mr Benari said this week that it still has more hires to make, fuelling speculation the firm could pick off more investment bankers from UBS as well as other competitors.

UBS has consistently said it will retain its position “as the pre-eminent investment bank in the Australian marketplace”.

Some had speculated that the investment bank may try to protect its top employees by enforcing non-compete contracts, which all bankers sign but are often loosely enforced.

Transurban, UBS and Barrenjoey all declined to comment.

Barrenjoey Capital CEO Brian Benari, executive chairman Guy Fowler and COO John Cincotta. The team has grown to include senior bankers from UBS and JPMorgan. Louie Douvis

Company disclosures to the corporate registry also show UBS Australia’s top legal eagle, Ms Spencer, signed up as a Barrenjoey director on March 4.

Her appointment is the latest in a long list of senior UBS defectors, including former advisory and capital markets managing director Guy Fowler, former head of research Chris Williams, former managing director Matt Hanning, former global co-head of flow rates and co-head of global markets Duncan Haig and senior trader George Kannan.

But while the group is luring top UBS stars to the new outfit, Barrenjoey is also looking to crimp its rival’s intake at the entry level.

While UBS Australia has participated since 2008 in the Professional Cadetships Australia business program, which enrols students in their last year of high school in a paid work program that runs alongside university study, Barrenjoey started accepting applications this month from current HSC students for the same program.

If you don’t get out of bed in the morning wanting to come to work, please don’t.

— Barrenjoey Capital document for staff

Barrenjoey promises prospective cadets they will work in an environment that “values people for their ideas”, “fosters a nimble environment”, and which “doesn’t believe in antiquated hierarchical structures”.

“The Barrenjoey Cadetship will typically be a four-year program and the study/work combination will be determined on an individual basis.”

While in the past the program has offered places in banks, including UBS, Bank of America Merrill Lynch, BNP Paribas, Westpac, QBE and Zurich, this year the only participating institutions are UBS and Barrenjoey.

Documents for staff held on the company’s website give a glimpse into the pitch Barrenjoey has made to bankers and analysts as it trawls the sector for talent.

“We are a true meritocracy,” Barrenjoey says. “Your recognition and rewards are based on contribution and teamwork, not constrained by hierarchy or bureaucracy.”

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“We don’t believe in multiple rank-based layers or grades (Associate, Vice-President, Executive Director etc.) – they constrain high performers.”

“There are only two levels at Barrenjoey; Partner and Principal. Both reflect that everyone at Barrenjoey will be part of the firm.”

“If you don’t get out of bed in the morning wanting to come to work, please don’t.”

“Never leak to the media – Barrenjoey doesn’t do this.”

UBS will never forget most the people working in Barrenjoey used to work in UBS and the left all of sudden and chose to work with Barrenjoey bank than UBS ,this is old report in AFR ,
How did UBS know the outflow or the inflow for MFG before company issue any figures ? Did they read the tea leaves ?