Preparing for what head of Lazard Ltd. Bruce Wasserstein called a “re-equitization of the American capital structure” over the next five to six years, the company hired Tom Tuft away from Goldman Sachs Group Inc. to prepare for that eventuality.
“Tom is one of the most highly regarded professionals on Wall Street,” Wasserstein said in a statement today. “Advising clients regarding capital structure and financing needs is a key growth area for the firm.”
Incidentally, Tuft was the counsel for Lazard when they were going through the process of their own IPO in 2005.
Underwriting IPOs has plunged so far in 2009, with approximately $11.4 billion only being raise so far, a drop of around 85 percent over last year. So expectations are that will turn around, as there is a demand there, it’s only a matter of the timing, which some feel is close at hand.
As far as Lazard, amazingly they haven’t underwritten one IPO so far in 2009, although the were involved in some way with a secondary offering for Iconix Brand Group.
Larger bankers have said that it will probably be private equity corporations like Lazard which will lead the return of public offerings as many companies look for ways to pay back their investors.
Wasserstein said concerning Tuft that the reason they hired him was because of the belief the IPO market is set to turn around, ““So if you are in our role of giving advice, giving the best advice is very important.” In other words, Wasserstein considers Tuft to be at the top of the game for advising companies going through the IPO process.
Industry watchers say that this could be a big opportunity for Lazard to expand in the IPO sector because Lehman Brothers and Bear Stearns are no longer in the picture, significantly narrowing the IPO-advice field.
For Lazard as a company, they’ve done pretty well this year in working in the bankruptcy sector, being part of nine out of the top ten bankruptcies so far this year.
Still, earnings in the second quarter for Lazard plunged by 33 percent to $43.1 million. Overall revenue also fell 20 percent to $375.6 million during the same quarter. At the end of July Wasserstein stated he believes it’ll take close to four years for the merger and acquisitions industry to bounce back to where it was a couple of years ago.
