The sale by Swiss bank EFG International of wealth manager Harris Allday has been thrown into chaos after insiders at the Midlands-based firm attempted to derail the process.
EFG has been trying to offload Harris Allday for several months, but has failed to strike an agreement to sell the firm, according to City sources.
Rothschild & Co is advising on the sale process, which hit trouble after a faction within Harris Allday devised an alternative plan.
At least one potential buyer was approached unilaterally by people within Harris Allday who proposed an alternative deal involving either a management buyout of the firm or a deal to take over only part of its operations, sources said.
Harris Allday was founded in 1834 and has offices in Birmingham, London, Ombersley and Shrewsbury. The firm, which was bought by EFG in 2006, had more than £3bn under management at the end of last year.
Wealth manager Canaccord Genuity was one of the parties that considered bidding for the firm before pulling out, two sources said.
Charles Stanley, the London-listed investment manager, and at least two private equity firms have been running the rule over the business more recently, another person said.
EFG International, which has a private banking business in the UK, is listed in Switzerland and has a market value of CHF1.5bn (£1.3bn).
The firm is part of the business empire of the billionaire Latsis family, which made its fortune in shipping and later diversified into oil and banking.
Yiannis “John” Latsis, a friend of Prince Charles, was a major Tory donor before his death in 2003.
Selling Harris Allday would make sense as it is not a core part of EFG’s private banking business and profit margins are tight, City sources said.
A spokesman for EFG said: “EFG International confirms that while no decision has been made yet, it is currently reviewing the strategic options for Harris Allday in the context of its previously announced international booking centre and footprint rationalisation.”