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May 28, 2014 2:01 pm
Bob Steel, the former deputy mayor of New York and vice-chairman of Goldman Sachs, is becoming chief executive of Perella Weinberg, the boutique investment bank.
His appointment shows Joseph Perella, co-founder of the firm, ceding some power and planning for his succession, which the 72-year-old told the Financial Times was vital but not a sign he was about to retire.
“You’ve got to be realistic. The clock is ticking. Don’t be one of those guys whose hands turn into petrified stone on the steering-wheel and you need a sledgehammer to break his fingers off,” he said.
But he added: “Investment banking is different to professional sports. As you age as an athlete your skills diminish. As you age as a confidant to a decision maker your skills, assuming you have all your faculties, should be enhanced with time.”
The recruitment of Mr Steel, who left City Hall when Michael Bloomberg’s term as mayor ended in January, shows the firm trying to become an institution that outlasts its founders, sometimes a difficult feat in the industry, especially when their names are over the door.
It could also be interpreted as a sign that Perella Weinberg is paving the way for an initial public offering, following rivals such as Evercore, Greenhill, Lazard and, most recently, Moelis & Co.
Mr Steel said he had not been enticed into the job by the prospect of taking the company public, however. “I’m excited to come here and get to work. It’s not conditional on the ultimate structure of the company.”
Mr Perella, who co-founded the bank with Peter Weinberg and Terry Meguid in 2006, added: “That’s not why we’re doing this. If we wanted to go public, not to be rude, we could have gone public without Bob.”
He contrasted Perella Weinberg’s hiring with Moelis’s. “When Kenny Moelis was recruiting people [he’d say constantly] ‘we’re going to go public, we’re going to go public, we’re going to go public’.” Moelis went public last month.
The appointment of Mr Steel also marks the consummation of a long courtship by Perella Weinberg. The bank first approached him in 2010. But, by his own admission, Mr Steel was by then well advanced in his decision to join Mr Bloomberg’s team.
Mr Perella said that the stint in public office, coupled with his time at the Treasury, had given Mr Steel a dimension until now lacking at the top level of the bank.
“Neither Peter, myself or Terry have ever served a day in government service, other than my time in the US Air Force. [Now] there’s hardly a day when you are not interfacing with the government.”
In spite of that missing ingredient, the firm has enjoyed a strong start to 2014, taking 2.5 per cent of the total fee pool for boutiques, up from 1.9 per cent during 2013, according to data from Thomson Reuters. That success comes against a backdrop of surging global M&A, which has already topped the $1tn mark for the year.
Mr Weinberg said he thought boutiques would eventually secure close to half of all M&A advisory fees, up from 30 per cent last year.
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