Evercore rides renewed activity to best ever Q1

Evercore reaped $512.1 million in advisory fees during the first quarter this year, constituting 43 percent growth over the same period of 2020.

This comes on the back of a favourable environment for M&A activity and capital raising, according to a transcript of the firm’s earnings call, which took place on Wednesday.

The US strategic merger market accelerated an eyebrow-raising 164 percent year over year and 13 percent over a strong fourth quarter alone. Global M&A saw a similar, if less explosive rise: an increase of 95 percent year over year. The fourth quarter saw mere 3 percent growth from Q3.

“With the key ingredients for M&A activity in place, a positive economic outlook, strong equity markets and available credit, high CEO confidence and continued private equity activity, the momentum for strategic activity continues,” said John Weinberg, Evercore co-chairman and co-CEO. Capital raising in new funds as well as secondary and GP-level activities is accelerating, he added.

The sector breakdown largely follows suit with recovery expectations. While healthcare still represents the largest portion, combined revenues from technology, media, telecom (TMT) and industrials more than tripled in Q1 compared with the full year 2020.

In expecting this momentum to continue for the next three to six months, as co-chairman and co-CEO Ralph Schloesstein indicated, Evercore is turning its focus toward attracting the talent to take advantage of it.

This is true across a variety of sectors and geographies, but particularly in tech sectors where the firm is “aggressively looking for talent”, said Weinberg. This comes off the back of the March hire of Mark Mahaney away from RBC as head of internet research, according to Evercore’s website.

Following a slow hiring year in 2020 due to uncertainty that did not resolve until the fourth quarter, the fight for talent is heating up along with deal activity, Schloesstein said. “Most firms are not up a lot in head count versus last year or even flattish. So, the fight for talent is pretty intense right now.”

He was quick to caveat, however, that he doesn’t expect the increased competition will prevent the firm from doing normal hiring.