Birmingham stockbroker Arden Partners (ARDN) could be on the verge of a takeover by an Indian firm, sources have claimed.
Arden Partners said in May that merger discussions with Cenkos Securities had been called off. But in a statement, the firm said it was still in discussions with a number of parties and sources close to the talks have indicated an Indian firm may be among the interested parties.
The Edgbaston-based broker posted a drop in profits on Thursday but said its second half had started well, despite a challenging UK small mid-cap market.
The firm said for the six months to the end of April, underlying pretax profit fell 46 per cent to £1.6 million and revenues fell 20 per cent to £6.7 million.
Arden said revenues from its corporate finance division were down 48 per cent to £2.5 million, reflecting more difficult market conditions and a delay in a key IPO.
But the revenue from the firm’s equities division revenue was up 17 per cent to £4.1 million on growth in income from research, sales and trading.
Arden Partners chief executive Jonathan Keeling said: “Corporate finance division revenues are down but the market would fully expect that. And also our cost base has also gone up.
“During a downturn, we are still out there recruiting good quality individuals so we will come out of the downturn very strongly.”
The company has recently recruited a new salesman as well as a market maker, who have both come from London to join its Birmingham office.
But the firm said it was more optimistic for the second half, which will be helped by the IPO of Indian oil and gas exploration and development company Indus Gas which was shifted back from the first half.
“We have a good pipeline of business going forward that we think we have got good opportunities of getting done.”
The company said it was maintaining its interim dividend at 2.2p a share.