(Reuters) - When Anbang Insurance Group acquired New York’s Waldorf Astoria Hotel last year, the Chinese company gained more than one of the city’s most iconic buildings. It got a base on Park Avenue across from the office of veteran dealmaker Paul Taubman.
This move made it easier for Taubman to meet Anbang executives visiting New York and score one of his investment banking boutique PJT Partners Inc’s (PJT.N) biggest victories: becoming sole buyside financial adviser to the largest ever acquisition of a U.S. company by a Chinese firm, people familiar with the matter said.
PJT is advising Anbang Insurance Group Co’s consortium on its $13.2 billion bid for Starwood Hotels & Resorts Worldwide Inc HOT.N, which the U.S. company said on Friday is superior to a merger agreement with Marriott International Inc (MAR.O). Marriott has until March 28 to submit a counteroffer.
PJT became a public company last year after it was merged with the advisory business of Blackstone Group LP (BX.N) and then spun off. Blackstone has carried out several real estate transactions with Anbang, including selling the Waldorf Astoria Hotel in New York for $1.95 billion and its Strategic Hotels portfolio for $6.5 billion.
PJT is itself no stranger to Chinese assignments. It is currently advising KFC and Pizza Hut chain owner Yum! Brands Inc’s (YUM.N) board of directors on spinning off its China business, as well as Yahoo Inc YHOO.O, owner of a minority stake in Chinese e-commerce company Alibaba Group Holding Ltd (BABA.N), on its strategic options.
PJT refused to comment on the investment banking fee it stood to receive from Anbang, and it is not clear whether the New York-based firm would be paid based on Western practices.
“We estimate that Anbang’s fees could be $60 million or so, due to the cross-border regulatory issues they are likely to encounter. Not a bad haul for a firm that just disclosed $286 million in total advisory fees for their fiscal 2015,” said Jeffrey Nassof, a vice chairman at consulting firm Freeman & Co LLC.
Anbang selected PJT because it wanted an investment bank that had not advised any of its rivals in the auction for Starwood, according to people familiar with the matter who requested not to be identified disclosing confidential details.
Anbang and its private equity partners in the consortium, J.C. Flowers & Co and Primavera Capital, are financing the cash deal themselves without bank borrowing, so PJT’s lack of a balance sheet was not an issue, one of the people added. Anbang declined to comment.
Taubman, a former Morgan Stanley (MS.N) investment banker, worked on Anbang’s deal alongside PJT partner John Trousdale, a former vice chairman of global M&A and global head of media & telecom M&A at Credit Suisse Group AG (CSGN.S), according to the sources.
Taubman is no stranger to big deals. Among his previous assignments are Verizon Communication Inc’s (VZ.N) $130 billion deal to buy out Vodafone’s stake in its wireless venture, and Altice NV’s (ATCA.AS) $17.7 billion acquisition of the fourth-largest U.S. cable operator, Cablevision Systems Corp.
PJT was ranked 29th in the Thomson Reuters M&A leagues table in 2015, advising on $74 billion of transactions, up from 62nd in 2014 on $15.2 billion of transactions.
Reporting by Mike Stone and Greg Roumeliotis in New York; Additional reporting by Liana B. Baker and Carl O'Donnell in New York and Michael Flaherty in New Orleans; Editing by Cynthia Osterman