Bonds without Borders: A History of the Eurobond Market

CHAPTER 7 Convergence and Credit 1995–1999

Guy Hands was born in South Africa but moved at an early age to England, where he studied at Judd School, Tonbridge, Kent. He went on to read Politics, Philosophy and Economics (PPE) at Mansfield College, Oxford. Hands' career began as a Eurobond trader at Goldman Sachs. He was promoted to Head of Eurobond trading in 1986 and later rose to become head of global asset structuring worldwide for Goldman's European division in 1990. Hands was keen to make the move from agent to principal on transactions and came up with a proposal for his Goldman management: ‘By the mid-nineties most people felt the UK pub business was dead. I went to Goldman and told them I wanted to buy £1bn of pubs and restructure the industry. I needed around £250m of equity, which, considering my trading book had been up to £4bn, I didn't think was a particularly large amount. Goldman looked at the £250m and suggested, maybe if I wanted to do that, I should find somewhere else to get the money from.’¹ Two other banks turned down his investment plan but Nomura in London saw the potential and Hands joined Nomura in 1994 and set up its Principal Finance Group (PFG) with 13 employees.

‘On my first day I told my team we would invest £1bn of the bank's capital over the next two years in asset-based businesses such as pubs, trains and houses.’²

True to his word, Hands and his PFG team's first purchase was a pub portfolio. Phoenix Inns was a portfolio of tenanted, untied ...