In France’s rural areas, one veteran Parisian dealmaker notes, politicians are grappling with shortages of doctors so acute they are termed “medical deserts”. Paris faces a different problem, he observes. “We have an overpopulation of bankers.”
The French capital is among the most competitive marketplaces for dealmakers in the world, where the prestige houses of Lazard and Rothschild & Co with their centuries-old pedigrees vie against the institutional heft of Wall Street’s biggest banks and their domestic French counterparts.
But in recent years, a new breed of competitor has swept into the city: American boutiques with a narrower focus on mergers and acquisitions advice, igniting a fierce battle for talent — and for mandates on deals involving some of Europe’s largest companies, from LVMH to TotalEnergies.
The defection of Matthieu Pigasse, Lazard’s celebrity dealmaker, in 2019 to Centerview Partners, sent shockwaves through Paris business circles, where Lazard and Rothschild have a long-established dynastic dominance.
Many of the major businesses of the CAC40 turn to Lazard’s bankers by instinct, returning repeatedly to debate deals in the wood-panelled rooms of its lavish Parisian headquarters. Lazard started out in the US and has a long heritage there. Unlike in New York, however, in Paris, Lazard is an undisputed market leader.
Relationships between Lazard, Rothschild and the business empires run by families such as the Arnaults of LVMH, the Pinaults behind Kering, or the Saadés, who run shipping giant CMA CGM, stretch back decades. A former Rothschild banker, Emmanuel Macron, inhabits the Élysée Palace.
When Pigasse made his move, Centerview Partners was an American upstart in Paris. Today, it is a force in French dealmaking, taking on clients from Danone to L’Oréal. Other deep-pocketed boutiques have arrived, including Lazard’s New York arch-rival Evercore. PJT Partners, Perella Weinberg and Moelis are also building a presence.
But their entrance has yet to dislodge Lazard and Rothschild at the top of Paris’s dealmaking league tables. A downturn in mergers and acquisitions has hampered expansion efforts: M&A revenues in France fell to $1.3bn in 2024, down from $1.4bn in 2023 and $1.6bn in the bumper year of 2022, according to Dealogic data.
Speaking to the Financial Times from his central Parisian office, Pigasse said: “It’s a Darwinian world: only the strongest will survive.”
The US boutiques have already proven their advice-focused model domestically. In New York, Evercore has displaced Lazard. Along with Centerview, it is challenging Wall Street’s largest banks in the top tier of the dealmaking league tables.
With Evercore, PJT, Perella Weinberg and Moelis publicly listed and their share prices close to record highs, the US banks have had to search for new sources of growth. Paris — along with Milan — may be the answer.
Although London has long been the natural first European outpost, in the wake of Brexit a Parisian office also provides the American arrivistes with a base from which to conduct the rest of their EU operations — and the capacity to service the private equity industry’s heightened interest in the continent.
But it is a complicated market to break into.
They are arriving more than two centuries after the Rothschild family first established banking operations in Paris in the 1810s, while Lazard Frères launched in the French capital in 1854. Wall Street’s biggest players have been in the city for decades, and have been beefing up their presence: JPMorgan has rapidly expanded since Brexit to more than 1,000 bankers in Paris. And then there is France’s homegrown investment banking champion, BNP Paribas.
Still, the four public boutiques and their private rival Centerview Partners have recruited more than 150 bankers in Paris since 2018, when Perella opened its offices, people familiar with the banks said. That is just 30 shy of the number Lazard employs; Rothschild has 240.
But one boutique banker notes that there are far from 150 new bankers in Paris. Despite the banks’ American roots, the hires are almost entirely French and come from competitors well-versed in the etiquette of Paris’s business elite.
Lazard has become the prime target: many of Rothschild’s senior staff are long-standing and it has not suffered the same exodus of talent. Now Pigasse and other bankers at Centerview and Evercore are trying to tempt away the clients they previously serviced at Lazard.
The upstarts are capturing an increasing share of the advisory business. Together, Centerview, Evercore, PJT, Perella and Moelis collected 6 per cent of French M&A fees last year, according to estimates from Dealogic — up from little more than 1 per cent in 2019.
Centerview has upgraded its Paris offices from its original home shared with Radio Nova, a radio station owned by Pigasse on the outskirts of the city, to the eighth arrondissement, a stone’s throw from Rothschild and Lazard — as well as PJT and Moelis.
But the raids have yet to put a serious dent in the business of Lazard and Rothschild, each of which has held its market share steady at about 12 per cent. “Even with the recent departures, the [Lazard] team in France has really done well at holding their ground and not losing many clients,” one New York-based Lazard banker said.
The boutiques insist they do not want to become volume players. Yves Ayache, the former Morgan Stanley banker who now leads PJT Partners’ Parisian operations, was one of several to say the boutiques were not “chasing market share”.
Boutiques can make good returns on a handful of high-value transactions, bankers insist. Centerview advised L’Oréal on the acquisition of luxury cosmetics brand Aesop, and says it wants to work with a small number of clients. “We’re not a bee that goes from one flower to the next: our only honey is that of the client,” said Pigasse.
And even if they have not seized substantial share from Lazard and Rothschild, there are other targets to take business from. A number of big banks are a diminishing presence in French M&A, including Société Générale, UBS, Deutsche Bank and Barclays.
The newcomers’ biggest competitors may yet be each other.
The high number of banks in Paris already keeps fees for dealmakers lower than elsewhere in Europe and the US, said one senior banker, with the arrival of new entrants likely to exacerbate the problem.
Each boutique also said it was interested in cultivating strong relationships with France’s largest businesses, and offering specialist services. PJT has made inroads in the restructuring market, for example, while Evercore and Centerview are looking to hire in the area, people familiar with the matter said.
With sluggish M&A deal flow to date this year and continued economic uncertainty, many boutiques will have to put up with limited business in Paris for the years ahead.
“If you’ve opened an office in Paris, it’s long-term,” said one boutique Parisian banker. “But people are going to realise the French market is far from being an El Dorado.”
Additional reporting by Sujeet Indap and James Fontanella-Khan in New York
