Staff and investors poised to turn on Close Brothers

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Senior management at Close Brothers, including chairman Rod Kent and chief executive Colin Keogh, will tomorrow face the wrath of its investors in the wake of its bungled sell-off which collapsed last Friday.

The bank will unveil its in-terim results and a clarification of its strategy tomorrow amid growing anger and frustration from investors and staff at the handling of the sale.

A senior Close insider said: "Staff are totally disaffected with what's been going on. The bid from Andy Stewart [at Cenkos Securities] had popular internal support. This process has gone on far too long – something has to give."

It is believed that Close's prized asset, Winterflood Securities, could now be spun out with a float or sale by the end of the year. It is thought that staff would be granted options on 20 per cent of the company, which could fetch more than £250m.

Granting Winterflood's staff a share in the business was a central tenet of the indicative £10.25- a-share offer tabled by Mr Stewart earlier this year.

The alternative option on the table is thought to be a management-led buyout of Winterflood.

Shares in Close slumped by 12 per cent on Friday, ending the day at just 659p.

Private equity group Blackstone was the last to quit the bidding process, amid a difference in valuations and an inability to offload Winterflood to Collins Stewart, which is still thought to be considering its own management buyout.

India's Tata and the little- known Japanese firm Orix were also in the race but dropped out earlier this month. A source close to Close said: "As with Cenkos, the issue with all these firms was a lack of financing."

But Mr Stewart dismissed the claim, telling The Independent on Sunday: "I can categorically tell you it wasn't a funding issue. That's absolute rubbish."

Close has been able to count on the support of its biggest shareholders, including Caledonia and Prudential, both of whom have links with the bank. Caledonia chairman Peter Buckley is a non-executive director at Close, while Prudential director and M&G chief executive Michael McLintock also sits on the board.

Mr Kent, who also chairs embattled buy-to-let lender Bradford & Bingley, also has links with Caledonia.

Meanwhile, the stockbroker Panmure Gordon, which is thought to have had talks with Cenkos last year, has dismissed rumours which surfaced last week that the firm could merge with rival Evolution.

Chief executive Tim Linacre said: "There will be no tie-up with Evolution. Likewise, there is no truth in the suggestion that we could be mulling a management buyout."