Evercore, Moelis Lead Drop in Boutiques Amid Inversion Crackdownby
Lazard and Greenhill also decline by at least 4% in New York
Inversion rules come amid threat of volatility stunting M&A
Evercore Partners Inc. and Moelis & Co. are among merger-advisory firms that tumbled after the U.S. Treasury Department announced a push to make it tougher for companies to pursue so-called inversion deals.
Boutique investment banks Evercore, Moelis, Lazard Ltd., and Greenhill & Co. each fell more than 4 percent as of 12:04 p.m. in New York. Houlihan Lokey Inc. and PJT Partners Inc., which both started trading publicly last year, also declined.
The Treasury Department said Monday that new rules would limit the ability of companies to pursue inversions that move a firm’s tax address offshore -- which could threaten some of last year’s largest announced deals including Pfizer Inc.’s agreement to combine with Allergan Plc. The move comes on top of market volatility that could also stunt M&A, after a record volume of announced deals in 2015, according to Jeff Harte, an analyst with Sandler O’Neill & Partners.
“Inversions were helping deal volumes, and it may go from a tailwind to a headwind,” Harte said by phone. “Volatile days, markets selling off and macroeconomic concerns around the globe make that less likely for continued strength in M&A activity.”