Writing about then Goldman Sachs banker Byron Trott in 2008, billionaire investor Warren Buffett said: “Byron is the rare investment banker who puts himself in his client’s shoes.”
The pair had worked together on Berkshire Hathaway’s USD4.5bn deal to take a majority stake in industrial conglomerate Marmon Holdings, while Trott also helped broker Buffett’s USD5bn investment in Goldman Sachs at the height of the financial crisis last year.
Considering their long-lasting relationship, it was perhaps not surprising that when Trott decided to strike out on his own this year, Buffett backed his enterprise, BDT Capital, and said he expected to call on Trott’s advice in the future.
Buffett’s decision speaks volumes about the power of relationships when it comes to appointing advisers for M&A deals. The past year has seen several examples of big-name bankers leaving bulge-bracket banks for pastures new – whether to an existing boutique or to set up their own firms – and taking their clients with them.
One of the most notable beneficiaries has been Evercore, which has landed several large mandates on the back of its team’s existing relationships. This month George Ackert, who joined Evercore in February to launch a transportation division, landed a role on Buffett’s USD36bn deal to acquire the 77.4 percent of Burlington Northern Santa Fe railway it did not already own. Ackert had previously built up a 10-year relationship with Burlington at Bank of America Merrill Lynch, where he had been global head of transportation and infrastructure.
Star pharmaceuticals banker Francois Maisonrouge has helped the boutique land two prominent roles. This year, he advised French pharma group Sanofi-Aventis on its acquisition of the 50 percent of animal health company Merial it does not already own from Merck, and also landed a role advising Wyeth on its USD68bn merger with US rival Pfizer.
Maisonrouge had previously been chairman of life sciences at Credit Suisse, where he was responsible for managing the firm’s relationships with large healthcare clients including Wyeth, GlaxoSmithKline and Roche.
Other smaller boutiques have also benefited from the trend. In foodmaker Kraft’s continuing bid for UK confectioner Cadbury, the US firm mandated boutique Centerview Partners alongside Lazard, Deutsche Bank and Citigroup.
James Kilts, partner and co-founder of Centerview, used to work for Kraft as chief of the worldwide food group at Philip Morris, which acquired the company in 1988. He had previously served as senior vice-president of strategy and development at Kraft.
Meanwhile, Foros Group landed a role as financial adviser to the transaction committee of the board of US healthcare data provider IMS Health, which in November agreed to be acquired by private equity firm TPG Capital and the CPP Investment Board, an arm of the Canada Pension Plan.
Its chief executive Jean Manas is a former head of M&A for the Americas at Deutsche Bank. Other senior members of the Foros team include Fehmi Zeko, formerly vice-chairman in global banking and chairman of global media and telecommunications for Deutsche.
The firm landed its first mandate in June, advising Virgin Mobile USA on its USD420m sale to telecoms firm Sprint Nextel, working in concert with Manas’s former employer Deutsche Bank.
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