The firm has dismissed six of its London-based partners – about a quarter of the total – as part of a performance review the firm is said to be instituting every six months. For a firm that practically invented the M&A business, this should not be all that surprising. Activity has plunged and with investors increasingly avoiding companies that pursue acquisition-led growth strategies, there are few signs things will improve.
But there is also another element at play. With the decline in business and the arrival of Bruce Wasserstein as uber-partner earlier this year, the firm is taking a more aggressive management approach. The chiefs of the three Lazard houses are now reviewing the returns of individual bankers with an eye to increasing the productivity per partner. So while some are shown the door, others are given the keys. Just last week Lazard whisked away Merrill's top two bankers in Frankfurt.
For those used to the kinder and gentler approach of yesteryear's Lazard, this may seem harsh. Indeed, by all accounts the bankers dismissed came from the traditional school of British relationship banking. The bankers include TMT specialist David Cummings, Andrew Adcock, Christopher Fisher and John Wilford, according to sources.
But bringing Lazard back into the vanguard of the cut throat investment banking business cannot be accomplished without some pain.