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Investment banking's new rainmakers

Arijit Barman/Mumbai 27 Apr 11 | 12:56 AM

Trailblazing careers apart, today’s hottest investment bankers have a lot in common. They are below 40, represent big finance and have been either colleagues or classmates

They are young, but not necessarily restless. Aggressive, yet empathetic of an Indian entrepreneur’s emotional connect with his business.

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They cut the clutter with no-nonsense negotiations and hard bargains, but are sagacious enough to walk away from a deal.

The savviest deal merchants among Gen Now have a different DNA. And if you thought a good investment banker can only excel with longevity and grey hair, you haven’t seen the ticker change.

Four of today’s poster boys of Indian mergers and acquisitions are below 40. Unprecedented in the otherwise regimented setup of investment banking. Clearly then, Topsy Mathew, MD, M&A, Standard Chartered Bank, or his peers Sameer Nath at Citi, Gaurav Gupta of Macquarie or Nikhil Nath, who recently got promoted as Nomura’s Asia (excluding Japan) head of investment banking, are mavericks.

Cynics will sneer, but the fact is that for any company keen on the global Indian takeover, these four bankers are likely to be the key brain trusts. Shopping, they say, becomes easier when these men are around as advisors.

It helps to be the quintessential global bankers in today’s age of big capital where even the role of the housebanker has changed. He is no longer a cult figurehead. Nor is he exclusive to any company.

Mathew comes straight to the point: “Institutions back the promoters. So it is no longer personal trust, but institutional trusts."

Just like Sameer, Nikhil Nath, too, has worked on Wall Street before moving back to Mumbai and admits we are following a global phenomenon. “I am a product of institutional thinking," he says. “In a cross-border transaction, there is advisory, financing, cross-regional and cross-cultural coordination. So the whole firm is behind a deal. And, honestly, the deepest relationships are the ones that are institutionalised."

GROWING WITH THE TIDE

TOPSY MATHEW
Managing director and head of M&A, India
Standard Chartered Bank

Age: 35

Memorable deals:
# PCCW-HK Telecom Merger, the largest deal in Asia

# Tata Communications’ acquisition of Teleglobe Igate-Apax buying Patni

Growing up in Dubai, studying in Australia and working in Singapore and Hong Kong early in his career, this 35-year-old can surely claim to have mastered the Asian ethos. And it’s not just a coincidence that he would return to Standard Chartered, where he now heads the M&A practice. As a bank, too, Asia has been a 150-year relationship for Stan Chart, which is growing stronger by the day.

“We have grown as the M&A landscape grew. Since the middle of the last decade, M&As have been a tool to enable strategy, not a last resort," Mathew says.

A large quotient of Mathew’s and Standard Chartered’s success in Asia, especially India, has been team effort. “Most of the original team of seven of 2003 have come back and stuck together as a cohesive team. And over the years we have all grown up understanding the challenges of cross-border transactions."

Mathew, too, came back after stints in DSP Merrill Lynch and Credit Suisse, but, in retrospect, his corporate finance stint in Hong Kong with Pacific Century Cyberworks (PCCW), a Hutchison group company, was the turning point.

PCCW was a chance to be on the other side of the table and luckily for Mathew it was again a matter of perfect timing. His stint coincided with PCCW buying HK Telecom in a jaw dropping $40 billion deal, till date the largest in Asia.

Being part of that one deal was good enough for Mathew to master the nuances of the sector. Since then he has become a deal magnet. “It has been a happy coincidence as telecom deal volumes in the last decade have been the highest," he says. The list of his telecom deals is exhaustive: VSNL’s acquisition of Teleglobe, a first listed company deal by an Indian, Bharti–Zain, Aircel’s tower sale to GTL, advising Essar during Hutchison’s exit from India in 2006 and even helping the Ruias value their stake in Vodafone.

Telecom may have been a bigger play, but from FMCG to steel to technology, Topsy and his “small bunch of 30 friends", who have grown more than four folds in eight years, have shown their mettle time after time.

Naturally, Mathew cringes when peers point fingers at many of his headline-grabbing assignments “that ride piggyback" on the financing that Standard Chartered offers in the deals.

“Ours is an ideas business. The quality of advice is the basis for a mandate and that in turn leads to trust over a period. When a company hires you for advisory and pays you accordingly, he expects that only. Financing is important but it comes later," he says. “You won’t have recurring relationships if you are only offering the balance sheet."

BRINGING THE STREET TO INDIA

SAMEER NATH
Managing director and head of M&A, India,
Citibank

Age: 37

Memorable deals:
# KKR-Flextronics

# Wipro-Infocrossing

# JSW-JFE

A Citibanker to the core, Nath’s career graph can be split into three distinct phases. The first six years as a technology banker in Wall Street, then a critical year in between, where he wore a different internal strategy hat, and then the last three years back home with an expansive mandate of heading a significant franchise.

He’s every bit a global citizen, He is enjoying the spotlight in India now, but the bets are on as to how long till the next challenge is thrown at him? Nath himself doesn’t hide from the fact and says: “Who knows what lies ahead, but it has to be something in Citi."

The internal relocation was a big comforting factor for Nath to move back to India in 2008 after establishing himself at the headquarters. “I was moving markets but not the organisation."

To be fair, even during his stint as a techie dealmaker at the heart of the Big Apple, there was a significant India play. Remember KKR-Flextronics, IBM-Daksh, IFlex-Oracle, EDS-Mphasis or Wipro-Infocrossing? “All these deals where we were involved or even during the Infosys ADRs or during the IPOs of Genpact and EXL, there was intense interaction with my colleagues in India," Nath reminisces.

But 2007 was the turning point. For a year, Nath was handpicked to work with the two global co-heads of the investment bank to help them formalise an internal strategy and figure out the machinations of a global entity. “This was a huge chance for me to expand my horizon. To understand different markets, products, debt as well as equity and also how to leverage our huge network fully," Nath admits.

Fitting into the shoes of a famous predecessor and build on the India piece in the spring of 2008 was no stroll in the park, though, especially when Citi itself got sucked into the global financial whirlpool. “Getting through the downturn with those headwinds was a fantastic learning experience."

The first thing that Nath did when he took over the India assignment “was roll up my sleeves and ensure that all the running deals got executed effortlessly". And now that he has settled in, he can build on the team and work in tandem with his colleagues to originate business ideas for clients.

The Wall Street exposure certainly comes handy as Nath diversifies into other sectors like telecom, pharmaceuticals, steel, mining and energy as a team leader. “We don’t want to miss any big deal opportunity but that’s not at the cost of smaller and mid-size deals." That’s Nath’s mission statement.

THE REAL ‘MAC’COY

GAURAV GUPTA
Managing director and head of India
Macquarie Capital Advisors 

Age:
35

Memorable deals:
# Axis Bank-Enam

# Fortis takeover defence in Parkway

# Macquarie SBI Infrastructure Fund-Viom Networks

By 2007, Gaurav Gupta had already set the benchmark for many of his peers when he sold MTR Foods for a mouthwatering $100 million to Norwegian foods-to-metals group Orkla. Even in those euphoric days, this one particular transaction was a tough act to follow for most dealmakers. Orkha paid nearly three times the turnover of MTR in a bidding war and Gupta pulled off a coup.

Gupta is sector-agnostic. Throw him a telecom deal and he will revel as much as he would while doing a banking or a healthcare transaction. That zeal comes handy when you have a challenging task at hand. Macquarie has always had a strong infrastructure focus in India and for Gaurav the brief from the headquarters was to broadbase the coverage.

Before Macquarie, life was comfortable in Nomura. It was early 2010 and Gaurav, along with a motley bunch of I-bankers from three other big banks had just closed Aircel’s telecom tower arm’s sale to GTL, when all of a sudden the opportunity came to lead this transformational journey for Macquarie investment banking in India. "I saw a great scope to develop the franchise across other segments, capital markets, and to be part of continuing to grow Macquarie beyond the realm of infrastructure where we have an excellent reputation globally," he says.

GG, as friends call him, has kept his promise. Macquarie has managed to pleasantly surprise most, by grabbing a handful of headline deals of 2010-11 across sectors in infrastructure, resources, industrials and healthcare. It advised Axis bank when it bought Enam’s investment banking division, managed the takeover defence and subsequent stake sale by Fortis Healthcare in Parkway Holdings and even helped affiliate Macquarie-SBI Infrastructure Fund to invest in Adhunik Power, Viom Networks and Moser Baer Power. Gupta is now busy raising $150 million for Tulsi Tanti’s Suzlon.

“Our investment banking business has achieved a significant amount in a relatively short period of time, utilising the wider group’s relationships and presence in Asia. At the end of the day, as deals are getting consummated, companies continue to notice us," Gupta proudly points out.

Additionally, there is also an “increased focus on capital market transactions" and principal investments. Sensing more business potential in a volatile market, Gupta has also tweaked his team a bit to suit the persona of a full service bank and by the time you will probably be reading this piece, the 20- member strong M&A and capital markets team would have probably shifted to a swanky new glass and steel office in Mumbai’s Bandra Kurla Complex.

ASIAN SAMURAI

NIKHIL NATH
Managing director-M&A, Asia (excluding Japan)
Nomura

Age: 38

Memorable deals:
# Apollo Tyres-Vredestein

# Tata Power fund raise

# GE’s sale of electric motors unit

Nikhil Nath has survived the storm. Not once but twice over. His investment banking career began a decade ago in New York when the headlines screamed dot.com bust, 9/11, SAARs scare and global meltdown. A decade later, he was still with the firm but the firm itself was turning turtle.

Eleven years and several global postings later, Nath can now easily claim to be a survivor in Lehman Brothers and then Nomura. Looking back, he remembers, “The year 2000 was a good time to get a job, but not a good time to stay in one. It was tougher then and I was a rookie when they were cutting to the bones. But after eight-nine years with the firm, I had more flexibility this time."

It surely helped that he was not in Lehman New York but in India, far removed from the eye of the storm. Now Nath is set for the biggest role in his career so far, heading the entire I-Banking business for Nomura in Asia, excluding Japan.

Like Sameer, Nikhil, too, has transformed his career over the years. Till 2004-05, he was a product banker on Wall Street but then it was the emerging markets experience for him in two successive postings in Japan and Hong Kong. Nikhil knew no Japanese, or Cantonese, but Asia helped him get a grasp over cross-border deals and the Asian way of doing business.

“In 2007, when we were building the India franchise, I was given the opportunity to move here in a coverage role and build new relationships. Now I am again moving back to a regional role where I can drive the M&A business and continue to strengthen the existing relationships and help develop new ones for the firm," he says.

Despite working in the US and Asia, moving back to India, which itself was at the cusp in corporate financing and M&As, had its share of both challenges and fun. “When I moved back, I lacked India experience, but I had worked in different geographies, cultures and in different situations across Asia, which helped me deliver quality advice to my clients in India. And, you will be surprised when you realise the common threads in these markets."

Nath has this one-liner and it goes like this: “It’s about asking the right questions and giving the right advice, and not necessarily about how many CEOs you know personally."

His CEO clients at Apollo Tyres or Hero Group or at Aircel will vouch for that. They know if an M&A deal doesn’t fructify, it won’t stop Nikhil in advising them on capital raising or a debt restructuring.

A true friend for all seasons.

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