Lazard Acquires O'Sullivan - Analyst Blog


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As part of its strategy to strengthen investment banking business, Lazard Australia - the Australian division of Lazard Ltd. ( LAZ ) - announced the acquisition of Sydney-based independent corporate advisory firm - O'Sullivan Partners. The financial terms of the deal were undisclosed.  

Lazard is one of the world's largest advisory and asset management firms with US$148 billion assets under management as of June 30, 2012. The company expects the deal to reinforce its presence in Sydney.

John Wylie, the chief executive of Lazard Australia, stated that the company has positive growth prospects from the Australian unit and the deal with O'Sullivan will strengthen the business in Australia.

With O'Sullivan's experience of acting as advisory to transactions that involved Ten Network Holdings, the deal will help Lazard get a larger team for their Sydney unit with varied expertise, primarily in the media sector. Also, it will help Lazard build a steady relationship with private equity firm, Kohlberg Kravis Roberts & Co. ( KKR ), after O'Sullivan acted as the advisory to three of its deals in the past five years.

Tony O'Sullivan, the founder and managing partner of O'Sullivan Partners, will head Lazard's Sydney investment banking team whereas Garren Cronin, Partner of O'Sullivan partners, will become one of the Managing Directors of Lazard.

Established in 2005, O'Sullivan has created an outstanding record in the Australian Mergers & Acquisitions (M&A) market over the last seven years, advising clients on M&A transactions and debt and equity capital market deals across a variety of sectors.

Advisory firms have been suffering due to the mergers and acquisitions environment around the globe.  However, Lazard's M&A and strategic advisory fees grew 15% in the second quarter of 2012. We expect the aforementioned deal to help Lazard further improve its M&A and strategic advisory fees.

Lazard currently retains a Zacks #3 Rank, which translates into a short-term Hold rating.

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