Horse Sense

Amateur jockey opens the first British brokerage in Israel.

NEIL COHEN SPECIAL TO THE JEWISH NEWS

S

teven Astaire comes
from a risk-taking
family. His father,
Jarvis, is a famous
promoter, best known for
staging major boxing bouts
such as the Tyson-Bruno
fight. Mr. Astaire is one of
Britain's only two Jewish
amateur jockeys — which,
at age 42, makes him even
more unusual.
But Mr. Astaire has
made it by taking risks that
weren't really risks.
In 1990, he bought back
the London brokerage firm
that bears his family name
from LIT Holdings, which
had bought it from Credit Lyon-
nais, one of France's major state-
owned banks. His uncle Edgar,
with whom he fell out, founded
the firm in 1960.
In their eagerness to partici-
pate in the deregulation of UK
securities markets, otherwise
known as the "Big Bang," many
banks, both British and foreign,
made ill-advised acquisitions.
Credit Lyonnais, for example,
bought both Astaires and the
much larger firm of Alexanders,
Laing and Cruickshank. •
Eventually Credit Lyonnais re-
alized that it had bought two
firms that did essentially the
same thing, and decided to sell
AstaireS to LIT.
LIT, a fast-growing financial
services company, was subse-
quently hit hard by heavy losses
in another subsidiary and let As-
taires go.
Because the original sale
agreement to Credit Lyonnais
stipulated that no one could use
the name Astaires but a member
of the family, Steven was the log-
ical buyer.
He had worked in the firm
since leaving schooL Because LIT
was keen to sell, he picked up the
business for about $250,000,
around 30 percent of its net as-
set value.
Less than four years later, that
deal looks pretty astute. In 1993,
Astaires made a net profit of
$711,532, almost double the 1992
figure. Astaire's 50 percent stake
in the firm is probably worth sev-
eral million dollars now.
Nonetheless, he pays himself
fairly modestly by the standards
of the City of London, earning
$97,000 in 1993. One director
made a cool $421,000, most of
that coming from performance-
related payments.

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Mr. Astaire's latest "risk" is
venturing into Israel. Not, as a
few U.S. firms have done, to sell
Israeli stocks back home or drum
up underwriting business, but
rather to service the sizable com-
munity of immigrants who are
permitted to invest abroad.
Astaires is, he says, the first
UK broker to open an office in Is-
rael. .
The firm has always been in-
ternational in its outlook, selling
foreign equities and bonds and
representing clients all over the
world.
They range, Mr. Astaire says,
from major Malaysian corpora-
tions to British tax exiles living
in Monte Carlo to German mort-
gage banks in Bremen.
Indeed, 80 percent of the firm's
revenue and 40 percent of its
clients come from abroad.
While offering clients a full ser-
vice, Mr. Astaire says the firm's
specialty is finding interesting
overseas bond situations that are
too obscure for the really big bro-
kers and institutions.
This typifies Mr. Astaire's op-
portunistic approach. When he
opened the firm's only other office
in Cheltenham (whose attractions
to him were a wealthy population
and a famous race course), he vis-
ited the three local public compa-
nies and offered to administer
their share option schemes.
The companies were happy to
be relieved of the chore and As-
taires soon picked up a sizable
amount of employee business.
The other brokers in town
"were more interested in getting
out on the golf course," Mr. As-
taire says.
Israel was, Mr. Astaire says, a
logical choice.
"Where else," he asks, "is there
a stable, growing economy with a

large expatriate community that
is not overbrokered? No other
country offers the opportunities
this country does. There is a win-
dow of opportunity here, and it is
not going to be open very long."
He feels that Israeli banks do
not have the expertise to serve
immigrants in foreign markets.
"I went into a bank, went over to
the girl who advises on foreign in-
vestments and asked her on what
basis she recommends foreign
bonds to clients. She said she takes
out the book of listings and looks
for names that she recognizes.
"We don't expect all their busi-
ness, but I hope the banks and
brokers will respect what we are
doing and support us."
In addition, he says, opening
an office in fiercely competitive
Hong Kong, for example, would
cost about $400,000. In Israel, the
figure is a quarter of that.
Mr. Astaire is also enthusias-
tic, perhaps a little naively, about
the benefits peace will bring.
want to be acting for the
Bank of Gaza and the Bank of
Jordan," he said.
Mr. Astaire believes that when
conditions are right, his firm's
presence in Israel will enable him
to sell Israeli stocks to clients
abroad, though that is not his pri-
ority at this point.
Mr. Astaire has recruited
Daniel Fuchs, a banker former-
ly with Israel General Bank and
Maritime Bank, to be the firm's
representative in Israel.
Astaires will be offering a toll-
free dealing line which it hopes
will entice clients seeking to keep
their phone bills down.
Mr. Astaire has high hopes but
modest expectations.
"If we are in profit by the end
of year two, I'll be happy," he
says. ❑

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