Maybe Greenhill juniors won't whinge about late bonuses now?
Today's news that Greenhill is being acquired by Mizuho for $550m looks like a mixed blessing for the 370 people who work there.
On one hand, Greenhill's people will now get to shelter under Mizuho's more ample umbrella, which is probably a good thing given that the firm has $270m of debt that matures on April 12, 2024.
On the other, the once prestigious firm is being sold at a value far below its peak. In 2010, Greenhill's market value was $2.5bn. It's been in steady decline ever since. Any senior banker who started working there in, say, 2017 when it was briefly worth $950m before the debt recapitalization, will be feeling disappointed with the amount they received for their shares today.
And yet, it's probably for the best. Not only was it unclear exactly how Greenhill planned to finance its maturing debt in 11 months' time, but analysts at Greenhill complained last year that their bonuses were late. It's not clear whether they really were late (some Greenhill insiders informed us there was no firm payment date), but this was the perception. Nor was this the first time: one senior Greenhill insider that payments in previous years often seemed to be two to four weeks later than expected.
By comparison, Mizuho has been gathering a reputation for generosity. The Credit Suisse securitized products bankers it rescued in February were said to be more than happy with the pay they were offered by the Japanese bank to move across.
What went wrong at Greenhill? The chief operating officer of one rival boutique said Greenhill has been underperforming other publicly listed boutiques for the past five-10 years. Top teams have been leaving, including most recently a team of top digital infrastructure bankers led by Pieter-Jan Bouten and Jonathan Dann. "It will be interesting to see if employees stay now that the bank is owned by Mizuho," suggested the rival COO. "I would have thought you may see more exits."
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