Rothschild blames deal drought for lower income from advisory

Michael Bow
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ROTHSCHILD, the centuries old banking dynasty, has posted a nine per cent drop in its advisory and banking business due to a slowdown in global M&A activity last year.

Results from the family firm’s holding company, Paris Orleans, show revenues for its Global Financial Advisory and Corporate Banking arms dropped to €768.1m (£600.6m) for the year ending March 2012, down from €848.2m in 2010/11.

The company blamed concerns over the Eurozone and worsening economic conditions since July 2011 for a slowdown in global M&A business activity.

The group’s net banking income was down six per cent year on year overall but its private equity business held up well, increasing net income 37 per cent from €57.2m to €78.5m.

The firm, established by Mayer Amschel Rothschild in 1798, is noted for its long standing family ownership structure, with Rothschild’s great, great, great grandson Baron David de Rothschild still serving as group chairman.

Its advisory firm now has around 1,000 advisers in 40 countries.

Figures from Rothschild shows it advised on 45 global M&A deals between March 2011 and March 2012, including the $11.3bn (£7.2bn) French telecom tie up between Vivendi and SFR in April 2011.

Since the end of March 2012, it has advised on a further 14 large deals, including Bright Food’s $1.9bn stake in Weetabix.

Figures released from KPMG yesterday show M&A deals are down 12 per cent since July 2011, with deal values down 18 per cent.