M&A boutique hirings may not unseat large top banks

By Paritosh Bansal

NEW YORK (Reuters) - A hiring spree by investment banks such as Moelis and Greenhill (GHL.N) may boost these boutiques up the pecking order of deal advisers, at the expense of some large rivals that have been shedding talent.

But the so-called league tables are still dominated by the healthier large banks, with firms such as Morgan Stanley (MS.N), Goldman Sachs Group (GS.N) and JPMorgan Chase (JPM.N) hogging the top few spots -- a state of affairs not likely to change any time soon.

Several boutique firms have been taking advantage of the financial crisis to hire investment bankers. As these bankers start work in their new homes after a "gardening leave" between jobs, they will likely tap into their relationships with clients to bring in business, giving their new employers more heft.

Still, boutiques by design face practical limits on the number of deals they can do and lack the ability to finance transactions, unlike a bank with a large balance sheet, investment bankers said.

And as they become successful and deal activity picks up again, some of them could be snapped up by larger banks.

"I don't know if you will see us or the other independent advisory firms break into the top three because of the sheer number of bankers we are competing against at the larger firms," said Jeff Raich, a managing director at Moelis. "But I think that you will see an increase in market share."

Moelis has hired about 15 managing directors this year and is looking for more, including multiple bankers in the energy and financial institutions sectors.

"We expect to have a fairly prominent position in the league tables, but it's not our critical mission," Raich said.