TORONTO Investment banking and asset management firm Lazard Ltd (LAZ.N) said on Wednesday that it had acquired Verus Partners, a boutique Canadian investment bank, to expand its financial advisory business into Canada.
The move comes as independent advisors have been commanding a growing share of the European and U.S. investment banking markets in recent years. Lazard has been seen as a pioneer of that trend. Toronto-based Verus provides M&A and capital markets advisory across all major sectors. Verus Managing Partner Brian Hanson will be chairman and chief executive officer of Lazard's Canadian investment banking division.
"There's a lot of room for the independent model to grow in Canada," Hanson said. "We're just beginning to see the market share penetration of independent firms in Canada."
Lazard's strength across a number of industry sectors will help its expansion in Canada, Hanson said. "The sector expertise that Lazard has fits very well with the industry profile here in Canada."
Lazard has asset management offices in Toronto and Montreal.
Canadian cross-border deal activity has been robust, with Canadian companies and pension funds increasingly looking outside borders for expansion. They often turn to advisory firms with a global reach.
Lazard was ranked No. 3 for mergers and acquisitions advisory involving Canadian companies in the first half of 2016, according to Thomson Reuters data.
“We continue to see significant opportunities for growth throughout North America," said Alex Stern, chief executive of Lazard Financial Advisory. "Companies in the U.S. and Canada are increasingly seeking independent advice as they pursue strategic opportunities domestically and around the world.”
Founded in 1848, Lazard has a presence in 27 countries. Its advisory business forms about half of total revenue. The company is headquartered in Bermuda and has its principal offices in New York.
Several global investment banks operate in Canada, including Goldman Sachs (GS.N), JPMorgan (JPM.N), Barclays Plc (BARC.L), Credit Suisse (CSGN.S), UBS (UBSG.S) and Morgan Stanley.
Lazard will also be competing more closely with major Canadian banks such as Royal Bank of Canada (RY.TO), Toronto Dominion Bank (TD.TO), Bank of Nova Scotia (BNS.TO), Bank of Montreal (BMO.TO) and Canadian Imperial Bank of Commerce (CM.TO).
Other independent investment banks in Canada include Canaccord Genuity Group (CF.TO), GMP Capital Inc (GMP.TO), INFOR Financial Group and Origin Merchant Partners.
(Reporting by John Tilak; Editing by Lisa Von Ahn and Meredith Mazzilli)