Panmure Gordon today raised £17.3 million to bolster its finances after “a shocking year” in 2008 saw it dive into the red.

The City stockbroker sold 72 million shares to Mayfair-based private-equity firm BlueGem Capital Partners for 24p each. It also said that business has improved since the New Year and the shares rose 11/2p to 351/2p.

The deal gave BlueGem — set up by former Merrill Lynch banker Marco Capello in 2006 — a 40.3% stake in Panmure.

It also left the stockbroker with a financial buffer of £40 million, more than three times the £13 million required by regulators.

Panmure chief executive, Tim Linacre, said: “The market at large is expecting all firms to have strong balance sheets so I wanted to make sure Panmure was as financially robust as could be.

“Panmure has been around for 130 years and I want it to be around for another 130. We now have a remarkably strong balance sheet.”

Capello, who was managing director of Merrill Lynch Global Private Equity before setting up BlueGem, was made a non-executive director of Panmure and was joined by BlueGem partner Emilio Di Spiezio Sardo, formerly a hedge fund manager at York Capital and an investment banker at Merrill Lynch where he worked in European mergers and acquisitions.

The BlueGem deal came as Panmure reported losses of £28.1 million for last year against profits of £5.7 million in 2007.

Revenues were down 35% to £42.1 million after a drought of fees from advising on takeovers and stock market listings.

It axed its dividend and paid no discretionary bonuses to staff although contractual payouts were met.

Panmure cut its workforce from 316 to 260 last year with 10 jobs lost in the UK, where it has 100 employees in the City and a further 10 in Liverpool. The rest of the job cuts came in the US.

Linacre said: “2008 was a shocking year. It was a shocking year across the industry and we are not immune to it and we took our fair share of the pain.

“I wouldn't have sat here a year ago and said Panmure Gordon would outlast Lehman Brothers, Bear Stearns and effectively Merrill Lynch but we did. It has been tough.

“I don't believe the industry is out of the woods yet. These markets will remain difficult for some time to come but so far 2009 is better than 2008.”

Revenues in the first quarter of this year were “substantially ahead” of the same period in 2008 with the amount billed so far in UK investment banking ahead of the whole of last year.

“Trading conditions in the first quarter have remained difficult, though recent weeks have showed a marked improvement,” said Linacre.