Citi in talks to secure Deutsche’s banking boss Alex Cartel

The high-profile investment banking boss role will be a critical position for Citi in Australia

Citigroup is in final negotiations with Deutsche Bank stalwart Alex Cartel to lead its local investment banking operations, as it looks to make a marquee appointment and fill a senior role left vacant for almost three years.

Mr Cartel, who leads investment banking coverage at Deutsche and is president of the Takeovers Panel, would be required to serve out a period of gardening leave if the appointment is secured over the weekend.

The Australian understands Citigroup is eyeing Mr Cartel to head up investment banking across Australia and New Zealand. It has been seeking a replacement for Aidan Allen who decamped to former employer UBS in 2017.

The new Citigroup investment banking boss will report to Tony Osmond, who is head of the firm’s banking, capital markets and advisory operations.

Mr Cartel has been involved in a number of notable transactions and takeover defences in recent years, including Santos’ $17.9b successful defence of the EIG Global Energy Partners and Harbour Energy approach, Unibail-Rodamco’s $US25bn takeover of Westfield, the Viva Energy’s $2.65bn ASX listing.

Last year, he worked on the $600m divestments by Kirin of its Lion Drinks and Dairy businesses to China Mengniu and Saputo.

Mr Cartel joined Deutsche in 2000 after a six-year stint as a mergers and acquisitions lawyer at Allens, his LinkedIn profile shows.

Deutsche has endured a turbulent period, culminating in the bank’s decision last year to pull out of equities sales and trading around the world. Deutsche’s shrinking local operations have seen others head of for exits in its local investment bank, including James Roth who joined boutique firm Record Point last month.

Writing in The Australian last week, Mr Cartel outlined differences between the global financial crisis and the current COVID-19 storm, delving into how company bosses were working through the issues and positioning for an eventual resumption of economic activity.

“Tomorrow’s corporate ‘winners’ are likely to be those whose leaders find the optimal balance between risk-mitigation measures aimed at ensuring business survival in the near term, and measures that position the corporate to capitalise on the eventual recovery phase, a phase that could begin unexpectedly.” he said at the time.

Mr Cartel and Citigroup separately declined to comment on Friday on his possible move.

Citigroup has had a strong start to 2020 for mergers and acquisitions advisory work, despite the impact of COVID-19 on deal volumes.

So far this year, the firm ranks in second place for M&A working on deals of almost US$3.5bn, behind Goldman Sachs in top spot at US$4bn, according to Refinitiv data. The firm is a defence adviser to Stanmore Coal as it assesses a takeover bid from Golden Investments and in January was tapped to work on the sale of Pact Group's contract manufacturing business.

Citigroup has, though, faced a tough time locally after being caught up in a cartel case launched by the competition regulator against ANZ and investment banks working on a capital raising it conducted in 2015. The charges – which are before the courts – relate to how a shortfall in demand for ANZ’s $2.5bn raising was managed.

While Citigroup, Deutsche and JPMorgan were acting as joint-lead managers on the raising, JPMorgan and a number of its bankers were granted immunity from legal action for their co-operation in the investigation.

ANZ, Citigroup and Deutsche are defending the Australian Competition and Consumer Commission’s court action.

Citigroup ranks sixth so far this year in equity capital markets transactions, as a spate of ASX-listed companies seek to shore up their balance sheets to see through the economic turmoil or position for a recovery.