Top Restructuring Groups 2019 & Restructuring Questions
Need Opinions & Advice:
- What is the new ranking for 2019 for these listed Restructuring Groups?
PJT, Lazard, Evercore, Houlihan Lokey, Guggenheim (post-Millstein acquisition), Moelis, Centerview, Miller Buckfire, Greenhill, Rothschild, Jefferies
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How many RX SA spots do most Restructuring Groups have?
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Which restructuring groups would you take an offer over a top-BB and over a mid-BB?
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Does Restructuring analyst make a higher salary/bonus than M&A?
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How do Restructuring exit-opps compare to M&A if you like distressed?
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Is it harder to get into Restructuring compared to M&A if you are a non-target?
Tier 1: PJT, Houlihan Lokey, Lazard Tier 1a: Moelis (I consider them top of the bucket, but heard of internal issues so unsure. Great group regardless), Evercore Tier 2: Rothschild, Guggenheim (Everyone know GUGG is growing so interesting to see how they shift the landscape, but they haven't had any big changes yet), Centerview, PWP Tier 2a: Jefferies, Greenhill (Supposedly on the decline) Tier 3: Miller Buckfire (Supposedly on the decline as well)
Most RX groups probably take around 8-14 SA firm wide across all offices, but this is flexible. Estimation based on the assumption around 5-6 in NY and another half for all regional offices (given they exist). Sometimes they recruit more because they're getting cranked (PJT, HL, LAZ), and sometimes they take less (?)
Would take PJT, Lazard, HL, Moelis, and Evercore RX over top BB any day. Pretty bold statement, but it's just a preference for EB over BB so take with a grain of salt. Better compensation, great exits (same at top BB as well), probably getting worked more, but the learning experience is unparalleled from what I've heard. Not to mention, many of these groups run great M&A arms as well.
Depends on the firm but often times, the compensation is higher in RX than M&A. Not that much of a difference from what I know
Exit-Opps depend on the firm, but I would argue the Tier 1 RX groups will have better exits than the top BB into distressed or even standard MF/PE. Just by way of nature, RX is more tuned to distressed than M&A so those coming out of RX will have a leg up
Yes, RX is extremely difficult to break into if you're not from a target or have someone pull for you. PJT RX (I believe HL as well) has historically taken the majority their SA from Wharton (3.8-3.9+), and it's a pipeline since the SA end up going back to campus to run campus orgs dedicated to SSG/Distressed/RX. Loop of better prepared, arguably more qualified, and top gpa students.
These are just my thoughts and opinions. All these firms are great in their own regard so take it with a grain of salt.
Want to add some color though I think the above is a great great start.
All-in I would highly recommend in the following order PJT, Lazard, Evercore, Houlihan, Moelis, Ducera, PWP, Greenhill, Guggenheim, Centerview, Jefferies, Rothschild, Lincoln, MB, Imperial. Would consider even FTI and A&M over MB, Imperial, and potentially even Lincoln.
Tier 1: PJT, Houlihan Lokey, Lazard (Agree)
Tier 1a: Moelis, Evercore (Agree, though I would rank Evercore higher than Moelis given culture, compensation, and exit ops. I think others may disagree, but I would add Ducera here. Creditor focused but easily a Tier 1a or a Tier 2)
Tier 2: Rothschild, Guggenheim, Centerview, PWP (I don’t think Rothschild is deserving to be Tier 2 - they lost both heads of RX early 2018 and wasn’t even on the league table in 2018. Group has fallen quite a bit. Would rank PWP has the highest out of firms listed in Tier 2 though would note a lot of energy-focused. However, fantastic culture and great compensation, can be a Tier 1a in future. Would swap Greenhill with Rothschild on your Tier 2 list. Neil Augustine went from Rothschild to Greenhill, Greenhill is on the up and up and doing very well)
Tier 2a: Jefferies, Greenhill (swap Greenhill with Rothschild and would note Jefferies is a great group but more tied to default rates - less out of court and more in court compared to others)
Tier 3: Miller Buckfire (would also add Imperial Capital and Lincoln here)
Greenhill is scaling up their practice, but saying Rothschild was not on the league tables in 2018 is false.
https://m.imgurDOTcom/a/i6NwP5A
Anyone who knows of Augustine would be wary of the culture at Greenhill Rx.
PWP and Guggenheim are also expanding and would also be great places to start along with Moelis, Evercore, PJT, Houlihan, Lazard, and Jefferies.
In some of the smaller groups it is important to look at specific deal experiences rather than league tables. Also noteworthy that in restructuring in particular, not everything makes the league tables. Often things are going on behind the scenes that don’t make the news, so it helps to talk to people in the group rather than on this forum.
Have several friends at top RX shops and a few at top distressed funds, and this is very outdated. Merely relaying info for all those interested. Don't @ me.
Many RX deals aren't reported in league tables due to out of court nature, creditor engagements with lack of press releases, and 2019 has seen a lot of changes.
Tier 1 - true. I'd put EVR there too. Rapidly growing and crushing it in past few years, esp. 2019 Tier 2 - Centerview, Moelis, GUGG Note: PWP got a few great mandates this year, so may be indicative of a huge upswing. GUGG acquisition of Millstein hasn't panned out yet, but will pay dividends in the future - this year has been slow for them Tier 3 - PWP, MB, Ducera, Rothschild - PWP may be tier 2 if they keep it up. Rothschild had massive departures this year and is doing very poorly overall. EU office is great though. MB also won some impressive mandates this year and is moving into more creditor work - really turning around this year. Ducera is also a great shop that is expanding quickly, with Cramer (ex-PWP) at the top. MB/PWP/Ducera could usurp Rothschild RX if they keep it up and Rothschild declines further. Bottom Tier - Jefferies (on the real decline, high turnover), GHL (avoid), all the smaller shops you haven't heard of
My ranking would be PJT, Lazard, HL, Evercore, Moelis, Gugg, Centerview, Greenhill, PWP, Rothschild, Jefferies and then Miller Buckfire
Definitely PJT RX by a long shot is at the top in terms of sheer exit opps quality and mandate history. HL RX is a strong second, and then further below are LAZ RX and EVR RX. Especially PJT RX or HL RX are the ones that get contacted by HH for credit/distressed buy-side roles.
Agree - they kind of force their analysts to exit with the 2-year program, but if it works, it works. I think what he meant by the head hunter comment is that PJT RX and HL RX are the first groups that distressed buy-side reach out to when recruiting. Completely agree that anyone in RX who wants to interview with distressed will get it, but those two names are top of the bucket right now for exits.
Your comment is highly questionable. Yes PJT RSSG Is the best group in terms of exit opps but to say they have the BEST mandates is quite subjective. They definitely have the largest deal volume per analyst but LAZ has won more prominent mandates including Sears, Toys R Us, Forever 21, Boeing, and as of yesterday Macy’s.
Additionally, I know at least three people from top targets (HYPSW) that had offers between HL RX and other RX groups like EVR and they all did not choose HL. HL hasn’t been an advisor for either the government’s bailout plan (PJT, PWP, MoCo) or Boeing (EVR, LAZ) so there’s no indication that they are trending to win the most prominent mandates over other established EBs in RX.
I would agree that PJT is the best group, not always because they win the best mandates, but because their caliber of analysts, exits, and deal flow per analyst are very impressive. Following that, I would still put Laz and EVR above HL even on just a pure exits basis and where top targets would choose to go.
Regarding prominent mandates, don't forget that PJT won the mandates for Windstream and Purdue Pharma. Wouldn't say that winning debtor-side as opposed to creditor-side mandates is any guidance for which RX group is the best either - MoCo advised iHeart and is advising Whiting, and PJT advised creditors in both cases, but I wouldn't choose MoCo over PJT simply because of that.
As for HL, seems foolish to say "there's no indication that they are trending to win mandates over other established EBs in RX" based on the airline restructurings alone (to which I should mention, I wouldn't be surprised if they'll be advising another debtor). Don't think they're too worried about your opinion on their mandate-winning abilities either when they were tapped for the Fannie and Freddie recap by the government and for the WeWork RX by SoftBank this past year. Not sure how ranking mandate-winning trends even applies given the current situation when nearly every major player in RX can't take any on more assignments. Some of the top kids at my school (HYPW) choose HL every year, and I doubt they were too upset about it.
As for exits, just going to link the following post: https://www.wallstreetoasis.com/forums/ebbb-class-of-2021-exits. Definitely seems as though exits are pretty similar for the 4 firms you mentioned, unless your information regarding exits says otherwise.
At the end of the day, the kids going to these shops are all incredibly bright and will be working on really interesting deals. Their decisions likely come down to where they liked the people the most and a preference between a purely RX-focused (PJT, EVR, HL) or a generalist program (MoCo, Laz) - I really doubt that they're paying too much attention to random rankings on WSO.
Also in terms of boutiques Ducera is quite a good firm for how little notoriety it gets here, they've landed on some pretty massive mandates. From what I hear it's quite top-heavy (Kramer was the former head of RX at PWP so no shortage of senior talent here) but if you're non-target, this might be the best place for you to look into. Looking at their analyst class, it is super all over the place from unconventional schools (Arizona St, U of Maryland, OSU, Florida Intl). Their interview process is also kind of like Allen & Co. in that it's pretty much an extended round table interview (a spread out superday of sorts) for a "first-round": essentially meeting 4-5 people individually over the phone to constitute whether or not you deserve a "superday" bid.
Can confirm after attending their superday. They do around 6-7 prime mandates per year and easily land in tier 2. Some of their work includes: Puerto Rico, Fullbeauty, Alpha Natural Resources, Shopko, Bristow Group, Toy's R Us, etc. And, they are adding people each year (double the team from its founding in 2015).
Frankly, I’m not sure if anyone here knows what they’re talking about. Moelis did 90bn in RX transactions in 2018. Evercore did 30bn. Let that provide some perspective.
These groups are all so small relative to M&A, I wouldn’t base rankings on things like “perceived culture.” And also I think all of this talk of tier 1 versus tier 1b, etc is all BS. There are good groups and then there’s everyone else.
Places worth working: Houlihan, PJT, Lazard, Moelis, Evercore, PWP, Rothschild (europe). Everywhere else is going to have literally less than like 4bn in deal flow. Probably not even worth discussing although I’m not ruling out the chance some MD at Ducera or Greenhill or wherever brings in a big one.
With all due respect, I’m not sure you know what you’re talking about. Now I agree with the point about rankings are futile because any one of those top firms would be great - but this is banking and analysts love to segment data, that will not stop. I have worked at a restructuring bank for many years and spent most of my career in restructuring so trust me when I say that any analyst that wants to do restructuring and has an offer for both Evercore NY RX and Moelis NY RX should choose Evercore RX based on exit ops, deal / team experience, transaction experience, compensation, and culture. In fact - Evercore beats Moelis in every category at the analyst level. I’m not saying not true for other levels, I can only speak definitively at the analyst level.
And anyone who works in RX would know that 2018 was a soft year so $90B would be an impressive grasp on the market. Are you sure you didn’t look at Moelis homepage and confused announced vs completed? How are you treating the elusive debtor-side role where only one bank gets the mandate compared to creditor mandates that often have many banks?
And yes it is rare, but some of the largest and most complex bankruptcies can span 1-3 years. If a bank somehow happens to be doing incredibly minimal / ops work on say Lehman which is finally confirmed in 2018 - making this up by the way - do you as an analyst really care? No, you want to be the analyst working on the deal in 2008 & 2009. Point is look at announced deals.
Regarding culture, don’t get me wrong, you will work a lot at both Evercore and Moelis. But you will he treated better at Evercore. Don’t take my word for it, reach out to friends / alumni and get their take on the subject if possible. I’ve yet to find one analyst who enjoyed their time at Moelis (as much as feasibly possible as a first year analyst in banking).
There is a high level of cyclicality in RX - though didn’t used to be this way. So if interested in RX, you work at a top shop, I can promise you’ll get enough transaction experience to be competitive with buddies at M&A shops. The nice thing about RX is that it’s specialized. M&A is a dime a dozen. So when we have periods of distress 2008-2010 and 2015-2016 pay and exit ops jump significantly, buyside funds will pay up a lot especially at the senior levels. And the big one is coming...you don’t have to have a complete 2008/2009 meltdown for distressed debt loan ratios to jump.
We all have our own opinions on individual group rankings and the group you should choose - if you’re lucky to have so many offers - is the group where you think you’ll be the most successful and where you like the team. But when it comes to the best groups, there are a select few where most share the same opinion. PJT RX (NOT THEIR M&A Group) is up there with GS TMT and MS M&A. Houlihan LA or NY RX and Evercore RX are a few laps behind but close.
And hope this goes without saying, but if you’re an absolute stud and have too many offers to count AND you absolutely know you want to do traditional private equity, don’t do RX.
Just wanted to provide some more detail on Greenhill because it’s still relatively new. Know they’ve been doing very well recently in terms of dealflow and hiring heavily, and a new MD is joining in August (from Lazard, was on exec board of Toys). As mentioned it can be hard to see how Rx groups are really performing because a lot of deals go undisclosed, especially if the wins are recent. The seniors will go to bat for you in buyside recruiting if you do good work - know some analysts who have recruited so far went TPG Special Sits, Cerberus PE, Centerbridge, and a distressed HF. Definitely work hard but zero facetime policy. Overall, still up and coming but exciting place to be with the opportunity to work directly with top MDs in the industry.