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Jun 30, 2008

On your marks: investor speed-dating reaches Europe

The UK trend for wooing investors speed-dating style has already spread to the US and is now making inroads in Europe

The Hotel Principe di Savoia was the perfect setting for Dresdner Kleinwort’s maiden Milanese speed investing event. Twelve tables draped in rich burgundy were laid out in a lavish room, sumptuously decorated with crystal chandeliers and hand-carved wooden paneling.

Nick Seaward, the brains behind the speed-investing concept, is keen to distance the event from speed dating. ‘IROs were initially skeptical about associations with speed dating, which make speed investing seem rather frivolous,’ he admitted to IR magazine in a previous interview.

Yet the parallels are unlikely to go unnoticed. A dozen IROs meet a dozen investors, with each having only a few minutes to attract the attention of their interlocutor before switching tables. If both parties take to each other, then a second date – sorry, meeting – can be arranged.

‘Although speed investing borrows a lot from the concept of speed dating, the former is deadly serious and extremely commercial,’ insists Seaward. While the concept has already been tried and tested in both the UK and the US, how Italian investors would cope with keeping things short and snappy was another matter entirely.

Being stood up
As it turned out, it was the unpredictability of Italian investors that threw a wrench in the works. As many as four of the 12 Italian investors due to attend did not show up. ‘They had confirmed to my face the day before,’ says Dresdner’s Milan-based head of Italian equities in disbelief.

Another Milan-based Dresdner employee stood in for the group’s absent client, ABN Amro. An IRO confides to IR magazine that the replacement investor was actually ‘more interested and knowledgeable than most.’ The last-minute dropouts created a series of ‘free’ sessions for the 12 companies, which had been expecting an intense day of non-stop grilling.

IR professionals dutifully turning up from as far away as Bradford in northern England, Darmstadt in Germany, Vienna, Athens, London and Paris made the best of the situation. IR magazine took full advantage of one of the investor-less tables to set up shop and grill unsuspecting IROs as they revolved round to one of their free sessions (see Speed reporting with IR magazine, below).

Cutting to the chase
Although three companies dropped out of the event, they gave enough prior warning for suitable replacements to be found – unlike the investors. One IRO, wishes to remain anonymous, didn’t take too kindly to being stood up by four investors. ‘It’s a question of integrity,’ he sighs. ‘We had something fairly important come up back home, but we had said we would come, so we came.’

Better-mannered investors chose colleagues to act as substitutes when other engagements cropped up. Many investors had done a surprising amount of research, too. ‘I didn’t expect them to be so well informed about UK supermarkets,’ remarks Niall Addison, head of IR at UK retail chain Morrisons.

Each investor-IRO exchange ended fairly promptly, thanks to fastidious time-keeping by Dresdner’s Damian May. His reminders – ‘Can everyone wrap up please? You have only a few minutes left. Don’t forget to hand in your notes’ – were unromantically reminiscent of a schoolteacher addressing pupils at the end of an exam.

While most IRO hopefuls went away fairly satisfied, the success of a similar event planned to take place in Madrid later in the year will clearly depend on the reliability of the investors involved. In his earlier interview with IR magazine, Seaward said the decision to stage the event in Milan and Madrid was based on the fact that local investors struggled to get the budgetary allocation to participate in Dresdner’s London events.

It appears time, rather than money, is the less dispensable commodity for investors, however. Whether the seven investors that chose to allocate their time will also decide to allocate their money to the IROs they met is dependent on those feedback forms left for Dresdner to sort through.

Any lucky IROs invited back to Milan can be sure they’ll be introducing their senior management to an interested suitor, before going in for the kill.

Speed reporting with IR magazine

Home Retail Group was one of the first victims of IR magazine’s questioning. We tried not to make it too obvious that we had been furiously listening in on the interview it had just held with Eurizon Capital. Head of IR Stuart Ford was joining his colleague at the Milan event after 11 days of roadshows. Both had already participated in Dresdner’s US speed investing event and admitted it was still quite hard to stick to the 20-minute time limit. They were in favor of the concept, but Ford said it was preferable to cram in as many meetings as possible.

France Telecom turned up to face investors in spite of ongoing rumors of an impending merger with TeliaSonera. ‘One investor said it came only because it knew we would be there,’ boasted the IRO from France Telecom. Some meetings were held with existing investors; it was not certain that new institutions would be investing in the telecoms group in the immediate future. ‘Merger rumors are still rife, and until the situation has settled I don’t think they will necessarily invest yet,’ explained the IRO.

Italian electricity giant Eni was another company called in at the 11th hour to replace a UK business that had backed out at the last minute. ‘We were telephoned at 4 pm yesterday and invited to come along,’ laughed Matteo Masi, the newest member of Eni’s 10-strong IR team, recruited last September. Meetings were led by Eni’s head of IR, Claudia Carloni, while Masi sat in on the afternoon sessions, taking over from another more junior colleague who had been present for the morning. ‘I just listened in and saw how Claudia interacted with the investors - it was great firsthand experience,’ Masi said of his first taster of investor one-to-ones.

London Stock Exchange-listed camera tripod manufacturer Vitec Group was an especially enthusiastic advocate of the event. Finance director Alastair Hewgill, who looks after IR for the small-cap firm, brought Italian divisional CEO Francesco Bernardi along to the event, to give a familiar flavor to Italian investors. Hewgill began by giving a brief overview of the business, then Bernardi lapsed into Italian to delve deeper into the activities of the group, which has a third of its employees based in Italy. ‘One of the investors we saw was solely dedicated to large caps, but generally the investors seemed really interested in us,’ remarked Hewgill.

Internet gaming company bwin also locked onto its Italian connections in a bid to win over interest. ‘ost investors instantly warmed to us for being the official sponsor of FC Milano, even though they didn’t always know what we did,’ smiled Konrad Sveceny, head of IR at bwin. The Austrian group stepped in at two days’ notice, to replace UK mortgage lender Bradford & Bingley, which was embroiled in the process of handling its controversial rights issue.