It is a riches to rags to riches story: just over a year after being seriously hit by the financial crisis and having to lay off 40% of its staff, Renaissance Capital (RenCap) is betting on growth and ready to go on a hiring spree. The Moscow-based investment bank is recruiting people in Russia and former Soviet countries but over half of the new hires will be abroad, especially in Africa where RenCap expects strong growth and significant opportunities.
“The pre-crisis plan was to become the leading emerging markets investment bank and that is still the strategy, – says Roland Nash, head of strategy at RenCap in Moscow. – The financial crisis has put us back about a year, but with the new hiring we will be expanding dramatically outside our traditional Commonwealth of Independent States boundary.”
RenCap now has five offices in Africa (Lagos, Accra, Lusaka, Nairobi and Harare) and employs 75 people, but the headcount is expected to grow to 600 within five years. “We have 600 people working in Russia at present and we believe our African business can become just as large, both in terms of revenues and staff,” says Quinn Martin, company spokesman.
RenCap is beefing up capabilities especially in the oil and gas and in the metals and mining sectors, “not just advisory work but also research, specialist sales and investment banking,” says Martin. Last year, using its CIS connections, RenCap sold Camec, mining assets in the Democratic Republic of Congo and in Mozambique, for $980m to Eurasian, a Kazakhstan mining company. In 2009 Africa delivered strong results for the bank at a time when Russia, as Martin puts it, “was a wash-out. Diversification really helped us.”
In Africa “we are strengthening the offices we have already and also opening new ones in new countries,” says Martin, adding that they will be hiring across the continent. “We do not do fly-in fly-out investment banking. People who do work in Africa live in Africa, from our regional Ceo Andrew Lowe to the analysts and researchers. We are looking for top-class professionals, like South Africans who are interested in working in the continent, local people with investment banking skills and also international people in London, New York or elsewhere.”
RenCap is casting its net wide and is also prepared to pay competitive rates to attract the best talent.
Nigeria, already the biggest market in Africa for the bank, is a particular focus. RenCap expects Nigeria to overtake South Africa as the continent’s biggest economy within a couple of years.
The bank also expects strong growth in Kenya. “The last two years have been very challenging for the investment banking industry in Kenya, but now we are seeing very positive signs and a rebound in economic activity,” says Patrick Mweheire, RenCap’s MD for East Africa.
“Corporate managers are considering expansion locally and regionally to boost earnings growth. This will definitely drive up the need for investment banking services in Kenya and the East African region. In addition, we are seeing a lot of renewed interest in sub-Saharan Africa in general and East Africa in particular from private equity funds.”