Kotak Mahindra, which broke its joint venture with Goldman Sachs in 2006, has tied up with US-based boutique advisory firm Evercore Partners to boost its revenues from investment banking, after losing to global giants such as Morgan Stanley and Barclays.
The deal with Evercore is the third such deal for Kotak which has been losing ranking to global firms in mergers & acquisitions (M&As) advisory as cross-border deals have almost become a norm with little in the domestic front due to funding constraints.
"The advisory business is a lumpy business. We will become a credible global solutions provider with this tie-up," said Falguni Nayar, managing director, Kotak Investment Bank. For Kotak I-Bank, cross-border constitutes 40% of its business. The idea is to increase income through cross-border advisory from 40% to 60%.
Kotak, which tops among investment banks in advising equity capital raisings, doesn't figure among the top players in takeover advisory, according to Bloomberg data. It has a partnership with Japan's GCA Savvian Corporation and Russia's Renaissance Capital. A deal with Malaysia's CIMB is on to offer banking services.
"The advisory business is a lumpy business. We will become a credible global solutions provider with this tie-up," said Falguni Nayar, managing director, Kotak Investment Bank. For Kotak I-Bank, cross-border constitutes 40% of its business. The idea is to increase income through cross-border advisory from 40% to 60%.
Kotak, which tops among investment banks in advising equity capital raisings, doesn't figure among the top players in takeover advisory, according to Bloomberg data. It has a partnership with Japan's GCA Savvian Corporation and Russia's Renaissance Capital. A deal with Malaysia's CIMB is on to offer banking services.
Also, experience in sectors like oil and gas, metals and mining, technology, telecom, auto and auto component and pharmaceutical helps grow advisory business. Kotak, like most other domestic Ibanks, faces competition from global investment banks, like Morgan Stanley and Goldman Sachs. After the Reliance-BP deal, the temptations to be present in developed markets like the US and the UK led Kotak to focus on these markets.
"This will open up three corridors for us. The advisory business is all about experience," said Nayar. Japan had contributed 15% to advisory revenues of the bank in the past fiscal year. Since local banks don't have the access to overseas investors, they lose out to foreign banks from the equity markets.
"This will open up three corridors for us. The advisory business is all about experience," said Nayar. Japan had contributed 15% to advisory revenues of the bank in the past fiscal year. Since local banks don't have the access to overseas investors, they lose out to foreign banks from the equity markets.
No comments:
Post a Comment