July 28 (Bloomberg) -- JPMorgan Cazenove Ltd., JPMorgan Chase & Co.'s joint venture with the U.K.'s Cazenove & Co., named Naguib Kheraj as chief executive officer, ending a five- month search for a permanent replacement for Robert Pickering.

Kheraj, 44, will start in October, the London-based firm said in a statement today. He worked at Barclays Plc, Britain's third-biggest bank, for a decade, before joining the U.K.'s Financial Services Authority last year as a senior adviser to a group created in the wake of the regulator's handling of failed bank Northern Rock Plc.

He joins JPMorgan Cazenove after the company forecast that earnings won't match last year, reflecting a decline in takeovers and stock offerings in the U.K. following the credit crunch. The pace of acquisitions in Britain will go on declining for the next 12 months to 15 months as the economy slows, accounting firm Grant Thornton LLP said.

``We will clearly not match 2007 earnings,'' David Mayhew, JPMorgan Cazenove's chairman said in an interview, adding that while the business was performing well in capital and debt markets, advisory was a difficult market in which to execute deals. Kheraj's experience ``crosses capital markets, private equity and fund management,'' the company said.

Kheraj served as global head of investment banking and private equity at Barclays Capital, Barclays's investment banking arm. He was named finance director in 2004, when he helped the bank buy control of South Africa's Absa Group Ltd. for 30 billion rand ($4 billion).

ABN Amro

He stepped down from that post last year, only to stay on to advise Barclays on its failed effort to buy ABN Amro Holding NV of the Netherlands. Kheraj said when he left as finance chief that he would probably seek a job in investment banking, private equity or asset management. Before Barclays, he worked at Salomon Brothers in London, and was co-head of global capital markets at Robert Fleming.

``I don't see any need for any dramatic change of strategy'' at JPMorgan Cazenove, Kheraj said today. ``The business is still in very good shape, and doesn't have some of the problems that have existed elsewhere. I'll be looking at every part.''

Cazenove, founded in 1823, created the venture with JPMorgan in 2005 to fend off competition from larger rivals such as Zurich-based UBS AG and New York-based Merrill Lynch & Co. Pickering expanded the firm's reach beyond share sales and mergers into bonds, raising capital for hedge funds and markets outside the U.K.

`Tough' First Half

Pickering announced his decision to step down as JPMorgan Cazenove's CEO in February after 23 years at the firm, including the last seven as CEO. At the time, he warned of ``a tough'' first half because the industry was reeling from turmoil in credit markets.

By October, Mayhew will have run the venture for five months as interim CEO. Management ``have taken on a heavier load but there is no evidence that the business has been suffering,'' Mayhew said. ``Kheraj will be available as required.''

Cazenove Group Ltd. said in February that pretax profit fell 11 percent last year to 80 million pounds ($159 million), while revenue was little changed.

The pace of British mergers and acquisitions has almost halved to $372 billion in the first half of this year after a record 2007, according to data compiled by Bloomberg.

To contact the reporters on this story: Joyce Moullakis in London at jmoullakis@bloomberg.net; Ambereen Choudhury in London at achoudhury@bloomberg.net

Last Updated: July 28, 2008 06:21 EDT