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The merchant banker, the broker and the Company chairman: a new issue case study


  • Jeannette RUTTERFORD

    (Open University)


This paper explores the roles of a merchant banker, Everard Hambro, and the chairmen of two companies, Thames Iron and Trollope, Colls & Co., in the restructuring of their companies at the beginning of the twentieth century. Their correspondence provides evidence that the choice of corporate capital structure had little to do with company needs or risk characteristics. Instead, Hambro, in concert with stockbrokers, concentrated on legal issues and on ensuring that the securities issued conformed in amount, type and price to market norms, including the avoidance of stock watering. The company chairmen concentrated on ensuring that they retained control and that the new issues were deemed a success.

Suggested Citation

  • Jeannette RUTTERFORD, 2005. "The merchant banker, the broker and the Company chairman: a new issue case study," Economic History 0503016, University Library of Munich, Germany.
  • Handle: RePEc:wpa:wuwpeh:0503016
    Note: Type of Document - pdf; pages: 23. in « L’entreprise, le chiffre et le droit », éditeurs J.G. Degos et S. Trébucq, Bordeaux (2005), pp. 305-327.

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    Corporate finance; stock watering; underwriting; new issues;

    JEL classification:

    • N - Economic History

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