Bullish on Greenhill PCA rebuild?
Anyone have any thoughts on Greenhill rebuilding from scratch their PCA unit? A bit questionable to have a former law firm partner as opposed to a banker or investor running things...
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For fund formation it’s definitely good to a former lawyer on board
I guess...but you have internal and external counsel for that.
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Compared to the Secondaries groups at EVR/PJT/LAZ a struggling Greenhill just doesn't have the backbone to support this kind of rebuilding of a group atm, at least in my opinion
They should prob focus on getting their M&A/RX business back on track
I think to really do a rebuild probably they needed way bigger talent at the MD/Partner level. A former lawyer with no IB or PE deal experience (apart from the usual legal execution) is a pretty weak substitute for the stacked deck EVR and even Jefferies are working with. I think they were desperate for leadership - questionable choices.
More hires expected according to WSJ, this is too soon to judge...
It starts from the top. Their head guy was drafting sub docs a year ago lol
Crazy they still had 40 people within PCA even after all of the defections
They may hire other secondaries MDs in the US as well...
Legal knowledge is definitely helpful when it comes to structuring GP-led transactions so as long as they get in other "banker" type of seniors, those skills should be complementary and they should do fine
Shouldn’t they be focusing on M&A? In theory, they have the brand name to compete with Evercore/Moelis
True, but let's not forget that GHL used to dominate the LP side of the secondaries market before getting poached by Jefferies and Portfolio Advisors. The future of secondaries is bright and in my opinion, PCA is a good source of alternative revenue when M&A market is down.
For example, GP initially wanted to sell their assets via traditional M&A market since the fund life is coming to an end. However, valuation is lower than expected so they transfer the assets into a continuation vehicle instead (hold longer instead of selling at a discount to let's say, another PE firm).
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