Rothschild & Co has become the latest entrant into an increasingly crowded secondaries advisory market.
The investment bank and asset manager has hired Andrei Brougham and Alvaro Rosado from PJT Partners to focus on sponsor-led secondaries transactions out of its London office, according to a statement seen by Secondaries Investor.
They will join in the second quarter of this year, taking the respective titles of managing director and director, the statement said.
Brougham was a director at the London office of PJT Partners, where he spent five years, according to his LinkedIn profile. Prior to that he spent six-and-a-half years with Greenhill’s secondaries advisory unit.
Rosado was also a London-based director, having joined in 2017, according to his LinkedIn profile.
Rothschild’s secondaries advisory team will form part of the Strategic Capital group, which advises long-term investors on capital raising for unlisted transactions. It counts sovereign wealth funds, Canadian pensions and large family offices among its clients, according to managing director and team head Christopher Hawley.
“The fact that these GP-led deals are increasingly centred around a single asset or two assets of very high quality, where sector expertise and positioning becomes very important, meant it was a very natural thing for us to get into,” he told Secondaries Investor.
Rothschild played a role alongside Evercore on the €1.2 billion single-asset transaction centred on nuclear medicine company Curium “articulating some of the specifics of the equity story and long-term value creation”, Hawley said. It worked on the initial M&A process, which turned into a secondaries deal with the onset of covid-19, as Secondaries Investor reported.
“Ultimately, you’re going to see sponsors buying from themselves as well as selling to other sponsors. That’s what we’re quite excited by,” Hawley said.
Five Arrows, a Paris-headquartered investment subsidiary of Rothschild & Co, held the final close on a €1 billion fund dedicated towards GP-led secondaries deals in January last year.
There are Chinese walls between the advisory business and the Five Arrows business and if the advisory team were working on a deal which Five Arrows wanted to look at, “our duty would be with the client”, Hawley said.
Such situations are unlikely to arise, and the firm has “robust internal processes to help deal with any potential conflicts as and when”, he added.
One senior advisory source expressed surprise that Rothschild & Co had not already entered the secondaries advisory market until now given the scope of its institutional client coverage.
This is the latest in a series of big moves in the advisory market. In July, US-based Matthew Wesley and Joseph Slevin departed from PJT Partners to launch a secondaries advisory unit at Guggenheim Securities, Secondaries Investor reported.
In the autumn, managing directors Todd Miller, Andy Nick, Chris Bonfield, Brenlen Jinkens and Scott Beckelman left Greenhill to launch a unit at Jefferies, with Goldman Sachs hiring Alex Meija from Lazard to start an advisory operation, as reported in December.