By Svea Herbst-Bayliss
BOSTON (Reuters) - Advisory firm CamberView Partners agreed to sell itself to boutique investment bank PJT Partners Inc (N:PJT) on Tuesday in a deal that comes as public companies seek help defending against activist investors demanding corporate changes.
PJT Partners, founded by former Morgan Stanley (NYSE:MS) veteran investment banker Paul J. Taubman, said it will pay $165 million to acquire the six-year-old advisory firm run by Abe Friedman. Of that amount, PJT will pay $100 million in the form of Class A common stock and partnership units and $65 million in cash.
The deal is expected to close early in the fourth quarter and PJT, which employs more than 500 people, plans to keep all of CamberView's 40 professionals, the companies said. Corsair Capital, CamberView's biggest investor, will become a shareholder in PJT Partners.
"CamberView's deep experience and expertise in shareholder and governance matters significantly expands our ability to serve clients," Taubman said in a statement.
PJT advises companies on mergers and acquisitions as well as restructuring and capital raising. With the merger it is positioning itself to offer activism defense banking services and advice to companies, a niche market currently dominated by Morgan Stanley, Goldman Sachs (NYSE:GS), Evercore and Lazard.
The two are joining forces at a time when more corporations are being pressured by investors to perform better and want help to defend against so-called activist investors, who often demand changes ranging from sale processes to share buybacks.
During the first half of 2018 a record 145 new campaigns were launched targeting 136 companies and activist investors won 119 board seats, marking a 75 percent increase from the year before, according to Lazard Ltd (N:LAZ) data.
Some of the year’s most prominent activist campaigns include Elliott's agitating at Nielsen Holdings PLC (N:NLSN), Jana Partners's planning to seek board seats at Pinnacle Foods Inc (N:PF) before it sold itself to Conagra Brands Inc (N:CAG) and Third Point’s call for soup maker Campbell Soup Co (N:CPB) to sell itself.
Taubman, one of Wall Street's top deal makers, left Morgan Stanley six years ago and took his company public in 2015. This year, PJT's share price has jumped roughly 30 percent.
This is not the first time PJT has pursued acquisitions. In 2014, Taubman agreed to merge his investment banking advisory firm with the advisory businesses of private equity firm Blackstone Group LP (N:BX).
Law firm Simpson Thacher represented CamberView while Weil, Gotshal & Manges represented PJT Partners.