Lazard to Close Offices, Cut Jobs in Business Realignment
Lazard to Close Offices, Cut Jobs in Business Realignment
(Bloomberg) --
Lazard Ltd., whose merger-advisory business is ranked at the lowest level in more than a decade, is closing a few offices and cutting jobs as Chief Executive Officer Ken Jacobs focuses on a “realignment.”
“There have been some changes in the macro environment globally, which leads us to believe there’s a better use of resources in other parts of the firm,” Jacobs said Thursday in an interview after the company released third-quarter results. “It’s more matching costs with revenue where the opportunity exists.”
Offices in Lima, Mumbai and Perth, Australia, will close, a spokeswoman said. Lazard is also planning to exit some asset management strategies that could account for about $300 million of funds, Chief Financial Officer Evan Russo said on a conference call with analysts. A total of about 200 jobs will be affected across different businesses, but headcount is expected to be little changed as the firm continues to hire, Russo said.
The company has been scrutinizing businesses and targeting underperforming units, the executives said. The asset management unit generates about half the firm’s revenue, and about 7% of that workforce will be eliminated, a person familiar with the matter said earlier this month. That would account for about 60 people, meaning other cuts would come in investment banking.
Recent high-profile departures include Matthieu Pigasse, the deputy CEO of financial advisory, and Gary Howe, a leader of Lazard’s financial-institutions practice. Lazard is “greater than any one person,” Jacobs said in response to a question about the exits on the analysts’ call.
Jacobs called the environment for mergers and acquisitions “OK,” and said CEO confidence has been mixed among executives seeking large-scale deals. Activity in Europe has been rebounding after months of uncertainty, he said. Still, the firm is ranked No. 12 among merger advisers globally this year, while it’s typically in the top 10, according to data compiled by Bloomberg.
To contact the reporter on this story: Sonali Basak in New York at sbasak7@bloomberg.net
To contact the editors responsible for this story: Michael J. Moore at mmoore55@bloomberg.net, Steve Dickson, Daniel Taub
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