Rich Ricci, the former Barclays executive, is to emerge as the boss of Panmure Liberum, a new mid-market investment bank that will be created this week from the merger of two of the City's leading brokers.
Sky News has learnt that Panmure Gordon and Liberum, both of which are privately owned, will announce on Tuesday that they are to combine in an all-share deal that will create the largest adviser to London-listed companies.
Sources said on Monday night that the deal would see Mr Ricci appointed as chief executive of the enlarged group, with Bidhi Bhoma, the Liberum chief, becoming deputy chief executive.
The aim of the deal, which will be subject to regulatory approval, will be to establish a new force in mid-market investment banking during what has been a fallow period for public share sales.
Collectively, they will advise 250 public companies and employ about 280 people.
A wave of consolidation has broken out in the sector, with finnCap Cavendish and Cenkos merging last year to form Cavendish, and Deutsche Bank acquiring Numis Securities.
Tuesday's deal will be the boldest move undertaken so far by Bob Diamond, the former Barclays chief executive, since his Atlas Merchant Capital vehicle acquired Panmure Gordon in 2018.
Atlas Merchant Capital is expected to be the single-biggest shareholder in the combined group.
The talks between Panmure and Liberum, reported by The Sunday Times shortly before Christmas, have been under way for months.
Both Panmure and Liberum, which is owned by its staff, made losses in 2022, in contrast to the previous year, when they benefited from a wave of capital-raisings unveiled by cash-strapped clients during the pandemic.
Both Liberum and Panmure declined to comment.