Revenues at boutique investment bank Perella Weinberg Partners fell about 9% in 2020, widening the gap against larger and faster growing competitors, according to regulatory filings for its upcoming stock Exchange listing.
The glimpse of its financial performance came as the New York-based company confirmed its intention to go public through a merger with a blank check company set up by the bank mogul. Betsy cohen.
The transaction values PWP at just under $ 1 billion and has been touted by the company as an opportunity to clean up its corporate structure and grow its transaction advisory business, as it seeks to keep pace with listed rivals such as PJT Partners, Moelis & Co and Evercore. .
PWP is expected to have generated around $ 485 million in revenue this year, up from $ 533 million in 2019, according to filings. This drop compares to a forecast increase of 2% in revenues at Moelis and 37% at PJT.
PWP, founded in 2006 by legendary Wall Street trader Joe Perella and former Goldman Sachs executive Peter Weinberg, remains smaller than its peers.
With the exception of a successful year in 2018 – when PWP collected massive fees for advising AT&T on its $ 85 billion buyout of Time Warner – the company generated an annual transaction fee of $ 400. to $ 500 million, according to figures shared by the company.
PWP’s average revenue per partner is around $ 10 million, a figure it expects to maintain even as new bankers are added in the years to come. The group has around 54 partners and a total of 560 employees, spread across 10 offices in five countries.
However, by 2023, it forecasts annual revenue of over $ 700 million, driven by the resurgence of the transaction market.
The companies closed deals worth $ 3.6 billion in 2020, down 5% from a year ago, according to data from Refinitiv, but with a strong rebound in recent months of the year. Bankers say they expect activity to continue as the world emerges from the pandemic.
“As a publicly traded company, we will continue to invest in growing our footprint and advisory capabilities, to expand our client network and broaden our advisory service offerings,” said Mr. Weinberg, Managing Director general of PWP.
As part of the deal with Ms. Cohen’s special-purpose acquisition company (Spac), FinTech Acquisition Corporation IV, which raised $ 230 million when it went public in September on the Nasdaq, PWP will also receive $ 125 million in new money from strategic and institutional investors. These include Fidelity, Wellington Management and Korea Investment & Securities.
PWP will use some of the cash raised to repay its existing debt, most of which comes from its 2016 acquisition of Tudor, Pickering, Holt & Co, a Texas energy-focused investment bank. Separately, it will use up to $ 110 million to repay PWP’s original backers and some of its retired partners.
Ms. Cohen, known as one of the first women entrepreneurs in the commercial banking industry, founded her first lender, Jefferson Bank, in 1974 and then established businesses in Hong Kong and Brazil.
The deal with PWP is its fourth Spac merger in recent years: the first three vehicles Ms. Cohen sponsored have merged with CardConnect, Intermex Wire Transfer and Paya, each a payment company.
“Over the past 15 years, PWP has built a differentiated global brand in the independent consulting space,” Ms. Cohen said. “We believe that PWP is well positioned to capitalize on this opportunity and has the expertise, the culture, the strategy, the brand.”