Peel Hunt, one of the City’s leading independent investment banks, is exploring a return to the public markets 20 years after it was taken private.

Sky News has learnt that Peel Hunt’s management, led by chief executive Steven Fine, has appointed Evercore to advise it on a process that could lead to an initial public offering (IPO) in the next 12 months.

Insiders said on Thursday that a flotation could value the broker at somewhere in the region of £350m.

If it proceeds with a listing, it would represent a triumphant return to the stock market for Peel Hunt.

A float would also trigger windfalls for many of the company’s 280 staff – the majority of whom are shareholders.

Peel Hunt has been buoyed by the resurgent market in London for public flotations, with the first quarter of this year seeing £7.2bn raised from IPOs – the highest level for 15 years.

Although bankers’ mood has been dampened by the furore surrounding Deliveroo’s public market debut, there remains a lengthy queue of companies wanting to sell shares on the London exchange.

Peel Hunt last changed hands in 2010‎, when its staff took majority ownership from KBC, a Belgian bank which had been caught up in the 2008 financial crisis.

That deal, which valued Peel Hunt at £74m, was backed by a collection of wealthy individuals, including the insurance tycoon Neil Utley.

KBC had paid £219m to buy Peel Hunt a decade earlier.

In 2018, the Spanish lender Santander showed fleeting interest in a takeover of Peel Hunt, but a deal failed to materialise after Mr Fine insisted that the firm was not for sale.

Peel Hunt competes with firms such as Cenkos Securities, Numis, Liberum and N+1 Singer to work on fundraisings and merger advice for listed companies.

Based on the price-to-earnings ratio of listed peers, some analysts believe Peel Hunt could now be worth about £350m.

Many of the City’s mid-market investment banks have been hit hard by new European markets rules known as Mifid II.

Peel Hunt has been a beneficiary of the changes, however, with 1200 institutions signed up to receive its research – three times the number before the new regime was introduced.

The firm’s corporate clients include JD Sports Fashion, John Laing, Mitie and Premier Foods.

It now boasts more than 150 listed clients with an average market capitalisation of over £700m.

People close to the firm cautioned that an IPO was not certain to proceed but said it was being actively explored.

In the year to March 31, 2020, Peel Hunt reported a revenue increase of more than 30%, with insiders saying that that momentum had continued in the financial year just completed.

A spokesman for Peel Hunt declined to comment.

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