Lazard to purchase Campbell Lutyens in bumper $575m deal
Lazard has reached an agreement to buy private capital advisory group Campbell Lutyens in a $575m (£426.3m) deal in a bid to become a global powerhouse in one of the most important areas of Wall Street dealmaking.
The 178-year-old investment bank’s existing private capital advisory team and London-based Campbell Lutyens will merge to create a division called Lazard CL, to stretch its abilities and take on competitors amid a widespread private market boom.
The deal, first reported by Bloomberg, comes as firms investing private credit, equity, infrastructure and property venture into increasingly complicated transactions which require advisory services.
Increasing importance
Advisory on fundraising and secondary transactions has become much more important to private equity groups in particular, as the sector grapples with an ongoing downturn in deal making and capital raising.
Campbell Lutyens focuses on advising private capital firms and their investors on fundraising and secondary transactions, including those in which fund backers sell stakes to other buyers or firms sell portfolio companies to new funds that they also manage.
Buyout fundraising and deals surged in 2021, with the frenzy fuelled by pandemic-era market turbulence, but this soon came to an end as interest rates climbed, leaving managers unable to exit bets or set up new investment vehicles.
The transactions have continued to gain momentum, driven by private equity firms’ trouble selling companies at deserved valuations, leading them scrambling to find other ways to generate and boost capital.
Industry participants have noted the escalating surge of fund managers and clients to secondary markets is a consequence of the private markets expansion and the need for new routes to liquidity.
The industry has grown from $14 trillion in 2020 to $24 trillion in assets under management last year.
The London group, which was founded in 1998, also advises private capital groups on the structuring of their own firms.
Elements of the deal
The combined unit is expected to generate $500m in revenue in 2027, while housing more than 280 advisers across 18 global offices.
The companies said the unit represented more than $100bn in secondary transaction volume over the past two years and raised more than $190bn in the same period.
The deal also includes a possible $85m additional performance-based payment.
Gordon Bajnai, chief executive of Campbell Lutyens hailed Lazards as a “highly complementary partner”.
Holcombe Green, head of private capital advisory at Lazards, also celebrated the deal, stating it would “build a global platform that sets the standard for excellence in private capital advisory”.