Giuliani’s Investment Bank Is Sold
Published at Deal Book.com
March 5, 2007
Giuliani Capital Advisors, the investment banking arm of former New York City mayor Rudolph W. Giuliani’s consulting business, will be acquired by Macquarie Group of Australia, Macquarie said early Monday. The sale, which was expected, comes as Mr. Giuliani embarks on a run for the presidency, raising questions about the fate of his various business endeavors.
Financial terms of Monday’s deal were not disclosed. But analysts had previously estimated that the business, which advises on mergers and restructurings, could fetch $80 million to $100 million in a sale. Giuliani Partners, the consulting group founded by Mr. Giuliani, bought the business in late 2004 from Ernst & Young, the accounting firm, for $9.8 million.
Giuliani Partners decided to sell its investment banking unit to prevent its clients’ activities from being used against Mr. Giuliani in a presidential campaign, a source told The New York Times in January, speaking on condition of anonymity.
A source at Giuliani Partners, also asking not to be identified, disputed that suggestion Monday, telling DealBook that the divestiture will allow Mr. Giuliani to focus on his campaign.
After the deal closes, Giuliani Capital will become part of Macquarie’s broker-dealer unit in the United States. The deal will give Macquarie an additional 100 investment banking professionals in North America, for a total of about 450, Macquarie said.
While not a top player in the mergers and acquisitions business, Guiliani Capital has a strong restructuring practice and has played an advisory role in several large bankruptcies in recent years. The bankruptcy business has been slow lately, but some analysts expect the number of corporate defaults to increase as access to credit for refinancings tightens.
“GCA provides Macquarie with an opportunity to build upon and expand our existing U.S. capabilities, particularly in corporate restructuring transactions,” Murray Bleach, head of Macquarie’s investment banking group in North America said in a news release Monday.
Mr. Giuliani is also a name partner at Bracewell & Giuliani, a law firm based in Houston that represents many energy producers.