Ken Moelis, who bought his begin at a Michael Milken-run agency and later clinched mega offers at his personal $4.6 billion boutique financial institution, plans to step down as chief government of Moelis & Co. this 12 months, the agency mentioned Monday.
Moelis, 66, will tackle the function of government chairman on Oct. 1, in accordance with a press launch. He’ll proceed advising purchasers on this new place.
Navid Mahmoodzadegan, 56, co-founder and co-president of Moelis & Co, will change the CEO and be part of the financial institution’s board of administrators, whereas Jeff Raich, 58, the opposite co-founder and co-president, will turn into the chief vice chairman.
Shares within the boutique agency dropped 1.9% Monday morning.
Moelis instructed the Wall Road Journal he expects to tug off the “smoothest transition ever in the history of Wall Street” – despite the fact that the financial institution shares his identify.
However the succession plans have been within the works for years, and Moelis has centered on coaching younger bankers, sustaining Moelis & Co’s staffing and strengthening relationships with purchasers.
His inheritor obvious, in the meantime, has been with Moelis & Co for the reason that very starting.
“As Co-President, [Mahmoodzadegan] has been involved in every major decision we have made and has been a key driver of our Firm’s most impactful strategic growth initiatives. He’s a unique talent and one of the best strategic advisors I have ever worked with,” Moelis mentioned in a press release.
Moelis began his profession in 1981 at Milken’s Drexel Burnham Lambert, the junk-bond pioneer that later collapsed amid a securities fraud scandal.
There, he shaped relationships with entrepreneurs like CNN founder Ted Turner and lodge billionaire Steve Wynn.
In 1990, when Drexel collapsed, Moelis moved to Donaldson Lufkin & Jenrette. He stayed there for a decade, finally rising to go of company finance and advising big-name purchasers like a pre-presidential Donald Trump.
When Drexel was bought to Credit score Suisse in 2000, Moelis left for UBS.
“It’s not easy to lose talent like Kenny. It’s not a positive thing for DLJ,” Trump mentioned on the time.
Moelis began his personal agency in 2007 with Mahmoodzadegan and Raich, after the three had turn into mates at DLJ.
Moelis & Co shortly scored a deal advising Hilton Accommodations Corp. on its $26 billion sale to Blackstone Group, which was introduced in July 2007. The private-equity agency has since bought its stake within the lodge chain.
Because it confronted the monetary disaster of 2008, Moelis & Co shocked Wall Road by setting off on a hiring spree – making the dangerous wager that corporations would proceed bringing huge offers to boutique corporations as an alternative of bigger banks.
The agency went public in 2014, although Moelis held onto a supervoting inventory and particular approval rights. A decide struck down a few of these rights final 12 months.
Shares in Moelis & Co reached an all-time excessive close to $80 in February. However the inventory is down about 20% up to now this 12 months as President Trump’s steep tariffs and sharp coverage adjustments have muted dealmaking.
Moelis’ agency has continued to advise main purchasers over the previous 12 months, together with Hailey Bieber’s skincare model Rhode, which lately introduced a $1 billion deal to be bought to elf Magnificence, and David Ellison’s Skydance Media, which has been pursuing an $8 billion acquisition of Paramount.
Boutique corporations like Moelis & Co raked within the second-highest share ever of merger-and-acquisition charges within the US final 12 months, in accordance with information from LSEG.
“I’m not sure I would have guessed 20 years ago that this segment would be this large,” Moelis instructed the Journal.
Each Moelis and Mahmoodzadegan mentioned they’re optimistic that this pattern will proceed.
“It’s funny, you advise clients all these years to do things at the right moment…and this is the right moment for the firm,” Moelis instructed the Journal on the timing of his departure.
Mahmoodzadegan and Raich had been promoted to co-presidents in September 2015 with future succession plans in thoughts.
The soon-to-be chief government has drawn in main offers within the financial institution’s media, sports activities and leisure franchise, together with a sale of the Phoenix Suns and Mercury to Mat Ishbia, the billionaire chairman of mortgage lender United Wholesale Mortgage.
