Energy Banker Vickers Defies Commodities Gloom With New Boutique

After a 30-year career spanning the energy industry, Julian Vickers, the former global co-head of Barclays Plc’s natural resources group, is venturing out on his own.

Vickers, who left the British lender last month, is starting a boutique advisory firm -- NRG Capital Partners -- focusing on energy-related industries globally, including metals and mining, and oil and gas. The veteran banker, who has also worked as the global co-head for energy investment banking at Citigroup Inc., is making the leap at a time when the sector is witnessing a downturn, hit by falling prices and weak demand.

“It is during periods like these that clients need quality advice,” Vickers said in an interview in London. “If you stick with them during difficult times, they tend to be with you when things turn around.”

NRG Capital will advise companies that are looking to sell assets or raise strategic financing. The firm will also help investors -- including private-equity firms, sovereign wealth funds and family offices -- find the best opportunities to spend their capital, Vickers said.

Diverse Team

In his new role as chief executive officer of London-based NRG Capital, Vickers’ has assembled a team of senior bankers and industry specialists, some of whom who have worked with him previously.

Mick Oliver, formerly the head of Canadian Imperial Bank of Commerce’s Europe, Middle East and Africa metals and mining team, has joined as a partner and managing director. Tuikku Alaviitala, previously a senior oil and gas M&A banker at both Barclays and Citigroup, and a former colleague of Vickers, is also a partner. Tim Daffern has joined as a senior mining adviser and managing director. He was previously the CEO of Hambledon Mining Plc.

NRG Capital currently has about six senior-level executives, Vickers said, and plans to add more staff.

“We don’t want to grow too fast and, as an advisory firm, we don’t need that much capital. Currently, the partners own all the equity in the firm,” he said.

Asset Sales

Large energy and mining companies are selling assets and restructuring operations to counter a slowdown in the industry. BHP Billiton Ltd. earlier this year spun-off some of its peripheral assets into South32 Ltd. in mining’s biggest spinoff in almost a decade, while Royal Dutch Shell Plc plans to sell $5 billion in assets this year and cut 6,500 jobs.

“Everyone sees this as a great time to be putting money into the sector but they aren’t really sure how and where to make those investments,” Vickers said. “Our aim is to marry the best assets with strong management teams, and to support them with quality long-term investors.”

Vickers, who began his career as an exploration geologist at Cominco before it merged with Teck Resources Ltd., wants to take advantage of opportunities created as some of the large global banks pull away from the industry to focus on multi-billion dollar transactions.

Boutiques Shining

Independent investment banks are rising in the advisory league tables for working on acquisitions in the U.S. and Western Europe. Robey Warshaw LLP, a two-year-old investment bank with fewer than 10 employees, advised BG Group Plc on its $70-billion sale to Royal Dutch Shell Plc, announced in March.

Energy-focused boutiques are also gaining in prominence with Hugh “Skip” McGee, the former chief executive of Barclays in the Americas, starting Intrepid Financial Partners to advise energy and power companies.

Vickers, who cites McGee as instrumental in hiring him at Barclays in 2009, said the downturn in the commodities sector will eventually move in the opposite direction.

“This is a cyclical business and the cycle will turn,” he said. “It was China driving demand last time but there are other pockets of future growth which could help drive the sector back.”

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