Moelis & Co opens Brazil unit as independent shops tap local M&A

SAO PAULO, March 11 Tue Mar 11, 2014 3:24pm EDT

SAO PAULO, March 11 (Reuters) - Moelis & Co LLC , the financial firm founded by banker Ken Moelis, opened an office in Brazil on Tuesday, the latest move by an independent investment bank into the merger and acquisitions business in Latin America's biggest economy.

Moelis & Co, which in recent days filed for an initial public offering in the United States, hired Otávio Guazzelli, Jório Salgado Gama and Erick Alberti from local investment banking shop BR Partners Banco do Investimento to start operations in Brazil, according to a statement.

Guazzelli and Salgado, who were also dealmakers working for Citigroup Inc prior to their stint at BR Partners, will co-manage Moelis & Co's Brazilian unit, the statement added. The office will be based in São Paulo, Brazil's financial hub.

The announcement came about a week after the New York-based firm filed for an IPO in the United States, with M&A activity having the strongest start to the year since at least 2007, according to Thomson Reuters data.

By establishing a foothold in Brazil, Moelis & Co will seek to take advantage of global interest for cross-border deals in a market with about 200 million consumers.

"Clients are increasingly looking for more global connectivity in financial advisory services. That is why our presence in Brazil is complementary to our global reach," Chief Executive Officer Ken Moelis was quoted in the statement as saying.

The move comes as independent investment banks including New York-based Greenhill & Co ramp up their presence in Brazil, taking advantage of a pullback by some of the world's largest investment banks after four years of soft economic growth led to a weaker-than-expected flows of deals.

Goldman Sachs Group Inc cut its roster of investment bankers in Brazil to about 20 from 45 a year ago, while Barclays Plc and Deutsche Bank AG reduced its research, sales and trading staff as competition mounted and business faltered, sources told Reuters.

UBS AG, which Moelis left seven years ago to found his firm, plans to give up one floor of its office space in Sao Paulo's upscale Faria Lima financial district.

Some of Moelis & Co's rivals, including Evercore Partners Inc. and Robert Greenhill's Greenhill & Co., conducted share offerings and have operations in Brazil. Moelis & Co has about 600 employees globally.

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