Retail brokerage Sanford Securities has launched Australia's first dedicated online investment banking operation. The new company will focus on the promotion and distribution of Inititial Public Offerings (IPO) to private investors over the Internet.
Sanford says the launch of the new operation is intended to capitalise on its experience in offering 36 issues over the Internet in the past 18 months. OCP Managing Director Simon Bell says the company has been founded on the mandate to grow a successful online investment bank in the mould of Wit Capital in the USA.
He says OCP will focus on managing and leading the distribution of product and securities offerings in the retail focussed $5 to $50 million range. On larger issues, Bell says OCP will work with other leading brokers, including major shareholder UBS Warburg. Sanford's strategic alliance with UBS Warburg gives it priority access to UBS Warburg sponsored issues for distribution down the retail online financial services channel, he says.
"OCP is effectively the hub for prospectus offerings, accessing offerings from a number of sources and then distributing through three channels; online financial service providers including Sanford Securities, National Online Trading and InvestorWeb; financial planners through Sanford's Virtual Broker; and traditional brokers," says Bell.
Retail investors applying over the Internet for any particular issue will be able to gain access to a prospectus, a research report, a summary of the issue, a copy of the broker power point presentations and a video of the managing director discussing his company.
Sanford chief executive officer, Steven Goh, says that OCP boasts one of the largest retail investor networks in Australia and is leading the way in democratising the IPO market.
"We are giving a wider cross section of the investment community access to issues and IPOs that traditional brokers reserve for their top clients," he says.