Less than a week after posting a 43 percent decline in its 2008 half year profit, Macquarie Group, the largest private manager of infrastructure assets worldwide, has begun to make reductions in its US staff, according to a person familiar with the matter.
The reductions are being made entirely within Macquarie Capital, which manages 35 listed and unlisted specialist funds and pursues investment banking activities worldwide.
According to the source, the significant majority of US staff in Macquarie Capital were not affected by the decision. The source declined to specify numbers of layoffs, explaining that some staff will be given the option to redeploy elsewhere within Macquarie.
Both professional and support staff were reduced.
Additionally, while staff numbers have been reduced, all business platforms that Macquarie Capital has been building out in the US in recent months, such as infrastructure principal and advisory, restructuring, equity capital markets and private placement, will continue to operate as normal, the source said.
Discussing the half year results last week in Sydney, Macquarie Group chief executive officer Nicholas Moore hinted that staff reductions could be a possibility, but stressed that the decision to cut staff would be made by local business leaders rather than by the head office. The 43 percent drop in its 2008 half-year profits is Macquarie's first results decline in 15 years.
Macquarie's US operations are headed by Tim Bishop, formerly the head of Macquarie Capital's diversified industries group in Sydney.
As of 30 September, Macquarie Group had 13,800 staff worldwide. Of that, approximately 1,300 staff members were located across 19 offices in the US, according to its website, which does not yet reflect the reductions.
Macquarie isn't the only global manager of infrastructure assets to announce staff reductions. Last week, Sydney-based infrastructure specialist Babcock & Brown disclosed plans to cut its workforce by more than 800 in an effort to reduce A$3.1 billion (€1.5 billion; $2 billion) of debt. Much of that reduction will be driven by divestments of non-infrastructure activities, the firm has said.