Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: After founding an investment bank that is catapulted to one
Speaker 2: of the world's most well known, Ken Mollis is stepping
Speaker 2: down as CEO of his namesake firm. The incoming CEO
Speaker 2: joins Bloomberg's Global Finance coursepond At Shaneli Basik for his
Speaker 2: first interview since that announcement.
Speaker 3: Sali Scarlett, thank you so very much. I am joined
Speaker 3: now by Navid ma Muzad again. Of course, he's the
Speaker 3: incoming CEO of Mollison Company. Will take over on October first.
Speaker 3: Congratulations first of.
Speaker 1: All on the room, Rotnalie, appreciate it.
Speaker 3: Now. Your founder, Ken Mollis has told me that this
Speaker 3: isn't the end of an era, it's the start of
Speaker 3: a new one. What does that mean?
Speaker 4: Well, look, first of all, I'm really honored and excited
Speaker 4: to take over as CEO. The firm is in an
Speaker 4: incredible spot, given our talent base, a lot of the
Speaker 4: investments we've made and making sure we're staying cutting edge,
Speaker 4: the culture which is phenomenal at the firm, and I
Speaker 4: think Ken looked at it and said this is a
Speaker 4: great time to hand over the firm to the next
Speaker 4: generation of leaders, and I know there's a lot of
Speaker 4: excitement throughout our company about all the opportunities that's going
Speaker 4: to present for me and for many of the people
Speaker 4: within the company.
Speaker 3: To the extent that there's something new about the way
Speaker 3: you're going to run the company. What should investors be
Speaker 3: looking out for, what should incoming talent be looking at for?
Speaker 4: Well, look, I've been with Ken for thirty years. We
Speaker 4: founded the company together, and the strategy that and the
Speaker 4: building blocks of the firm have been very consistent throughout
Speaker 4: the founding of the company. A lot of that's going
Speaker 4: to continue with the core of what we do, putting
Speaker 4: clients first, Hiring and developing the best bankers in the world,
Speaker 4: and creating a culture that supports those bankers is not
Speaker 4: going to change. I'll bring obviously a different energy to
Speaker 4: it and a different leadership style to it, but the
Speaker 4: core of our strategy is going to very much stay
Speaker 4: intactity of.
Speaker 3: It too, is that you're taking over at a very
Speaker 3: complicated time, both in markets and in the world. As
Speaker 3: we sit here today, there have been four days of
Speaker 3: missile strikes between Israel and Iran, and Molism company has
Speaker 3: a big presence in the Middle East. What are your
Speaker 3: clients saying about the uncertainty that's building around this regional conflict.
Speaker 4: Well, first of all, Shanali, we have Molu's employees, parts
Speaker 4: of our MOLAS family in the Middle East, and our
Speaker 4: first priority, in our first area of focus is making
Speaker 4: sure you know, they're safe and sound, and thankfully we're
Speaker 4: in constant contact with them and they're doing well so far,
Speaker 4: So that's our number one priority. Look, we're in a
Speaker 4: world that's changing rapidly all the time. I've been bullish
Speaker 4: on the return of M and A and the steady
Speaker 4: improvement that we've seen since April.
Speaker 1: The Middle East conflict.
Speaker 4: The latest Middle East conflict is early days and is fluid,
Speaker 4: and so we'll have to monitor that really carefully. But
Speaker 4: I continue to be optimistic that the forces that are
Speaker 4: driving M and A are still very much intact. You
Speaker 4: will see how it plays out, but that's still my perspective.
Speaker 3: Do you think that the geopolitical tension has the opportunity
Speaker 3: to really throw a wrench in some of the activity
Speaker 3: that's been coming back.
Speaker 4: Well, sure, Look, geopolitical risks and things like wars always
Speaker 4: have the potential to create bad outcomes.
Speaker 1: But again it's really early days.
Speaker 4: We're monitoring the situation carefully and we're obviously hoping for
Speaker 4: the best.
Speaker 3: At the same time, here in the US, investors have
Speaker 3: been responding to tariffs as well. CEOs have been changing
Speaker 3: their business lines around the president's plans. How concerned are
Speaker 3: you and your clients about the impact of tariffs?
Speaker 4: So when you look at the companies and financial sponsors
Speaker 4: and capital providers, Look, there's a whole swath of those
Speaker 4: of industries and areas and companies that.
Speaker 1: Have very little to do are very little impacted by
Speaker 1: things like trade and tariffs.
Speaker 4: We're seeing still a lot of activity in those areas
Speaker 4: as you get closer and closer to manufacturing and companies
Speaker 4: that are in the heart of some of the trade
Speaker 4: impact areas. Clearly that's more difficult to do M.
Speaker 1: And A today.
Speaker 4: And look, I'm hoping that we'll reach an equilibrium here
Speaker 4: on the terriff issue soon so that CEOs and capital
Speaker 4: providers can kind of gear into what that new world
Speaker 4: looks like, and so you know that uncertainty comes out
Speaker 4: of their thought process.
Speaker 3: I hear a lot from deal makers that there's this
Speaker 3: pen dep energy under the surface for some people who'ven
Speaker 3: record pipelines, what does that look like.
Speaker 4: Look, we're seeing it in our business. We're at our
Speaker 4: near record highs as well. When you talk to our bankers,
Speaker 4: there's activity all across the firm. There's lots of client dialogue.
Speaker 4: And I agree with you. I think clients, private equity clients,
Speaker 4: corporate clients really do want to do transactions. They see
Speaker 4: transactions as a useful tool to supercharge growth, to get efficiencies,
Speaker 4: to improve their market positions, and to deal with innovation.
Speaker 4: You know, we have a massive wave coming in terms
Speaker 4: of the impact on things like AI and our economy,
Speaker 4: and people want to be well positioned for that.
Speaker 3: Now, M and A this year isn't what everybody hoped
Speaker 3: it would be. But you yourself have been on transformative
Speaker 3: transactions for example, paramounts guidance is when I know that
Speaker 3: you've been involved in, what does the deal activity that
Speaker 3: we've seen so far say about the deal activity that
Speaker 3: might still be to come.
Speaker 4: Look, as I said, I think there's just a lot
Speaker 4: of demand to do transactions. The environment hopefully will get
Speaker 4: more conducive to doing even more and having a wider
Speaker 4: aperture on the kinds of transactions that could happen. Again,
Speaker 4: hard to predict all of those things, But what I
Speaker 4: can tell you in our conversations are people want to transact,
Speaker 4: they want to lean into deals. There's lots of capital
Speaker 4: available to do that, and is if the conditions improve,
Speaker 4: I think you're going to see a big pickup in
Speaker 4: announced transaction activity.
Speaker 3: What about restructuring activity in particular, you see kind of
Speaker 3: both sides of the economy in that way. When things
Speaker 3: go well, people might want to do deals. When things
Speaker 3: go wrong, they might have to look at either restructuring
Speaker 3: or even bankruptcies. Do you see any trouble under the surface.
Speaker 4: Look, we have a top franchise in this part of
Speaker 4: the world restructuring, liability management, capital solutions. There's generally a
Speaker 4: pretty steady stream of activity in that space if you
Speaker 4: have a top franchise. Clearly there are spikes when you
Speaker 4: get periods of economic turmoil or turmoil in.
Speaker 1: Industries or high default rates.
Speaker 4: We're not in one of those periods today, but generally
Speaker 4: there are companies that need solutions either too over levered
Speaker 4: balance sheets. We had a bunch of over levered balance
Speaker 4: sheets created post COVID. A lot of the work that
Speaker 4: our teams have been doing over the last couple of
Speaker 4: years has been dealing with pushing out maturities and giving
Speaker 4: companies more breathing room.
Speaker 3: And for the people who don't know, you were a
Speaker 3: huge part of what had pushed Molism Company into private
Speaker 3: capital in a bigger way. A big part of advisory
Speaker 3: work during COVID era of financings when private capitals stepped
Speaker 3: in to help companies out. Is this anything like COVID?
Speaker 3: Are there echoes of it where you could see private
Speaker 3: capital step in for big rescue financings.
Speaker 4: Look, one of the big revolutions that I've seen over
Speaker 4: the last ten years is just the huge number of
Speaker 4: alternative asset managers who are they're raising big pools of money,
Speaker 4: very flexible pools of money to invest up and down
Speaker 4: the capital structure.
Speaker 1: We welcome that. We think that's great for the economy.
Speaker 4: It's great for business, and it's great for firms like
Speaker 4: ours because there's now many more sources of money and
Speaker 4: we're there to help advise clients tap into those sources
Speaker 4: of money.
Speaker 3: You know, another interesting thing about your focus is here
Speaker 3: on structuring m and A private capital is that it's
Speaker 3: also taking you into new areas, and you've hired during
Speaker 3: times of frankly crisis. For others, you hired from credit suites.
Speaker 3: You're hired out of Silicon Valley Bank's demise as well.
Speaker 3: And now is another moment where global banks are in
Speaker 3: the process of cutting hundreds of jobs. Do you see
Speaker 3: an opportunity to bring people on.
Speaker 4: Look, one of the foundational philosophies that we've had from
Speaker 4: the beginning is to be opportunistic and to hire great
Speaker 4: talent even when times were a little murky. So the
Speaker 4: firm was really built through the global financial crisis. We've
Speaker 4: generally been contrarian. When talent is available, even if it's
Speaker 4: not the best market, you have to seize that opportunity.
Speaker 4: It's one of the reasons why we keep a pristine
Speaker 4: balance sheet to give us the financial flexibility to do that.
Speaker 4: And yet, and yes, once again when the regional banking
Speaker 4: crisis hit, we use that as an opportunity to really
Speaker 4: bulk up and hire teams in technology and an oil
Speaker 4: and gas. And we're doing that again now with the
Speaker 4: build we have in a business we're calling PSA Private
Speaker 4: Solutions for the private equity world.
Speaker 3: So what does that mean in terms of the new
Speaker 3: teams you're willing to bring on at MOLUS.
Speaker 4: Yeah, well, look, we've made some major hires in this space.
Speaker 1: You know, private equity firms have evolved.
Speaker 4: We've always been in the business of buying and selling
Speaker 4: companies to and from private equity firms, but now we're
Speaker 4: getting into the business in a big way in terms
Speaker 4: of primary fundraising for their vehicles and then as well
Speaker 4: as also being able to service them in GP LED secondaries,
Speaker 4: LP LED secondary continuation vehicles. You know, those are major
Speaker 4: growth areas for US, major market opportunities for US, and
Speaker 4: the recent hires we've announced will enable us to have
Speaker 4: a top franchise in those areas, we hope.
Speaker 3: You know, another really interesting area that Molis has really
Speaker 3: been forging into a sports You yourself have been personally
Speaker 3: involved in the stake sale that is ongoing of the
Speaker 3: New York Giants as well as the Phoenix Suns in
Speaker 3: recent years. So how big of an opportunity is this company?
Speaker 3: Why you yourself have been on deals, But is this
Speaker 3: something that is going to be a massive area for MOLAS.
Speaker 4: We have a major effort in a big franchise in sports.
Speaker 4: There's the velocity of transactions has really been astounding, not
Speaker 4: just with teams, but also in the ecosystem of sports
Speaker 4: companies that are providing services into the sports space, whether
Speaker 4: that's sports betting or facilities management and things of that nature.
Speaker 4: You're right, we've been lucky to work on some landmark transactions.
Speaker 4: I spend a lot of time on it myself. And
Speaker 4: one of the things that's driving a lot of the
Speaker 4: number of transactions is not just the increase in valuations,
Speaker 4: but these big pools of money, many of which are
Speaker 4: private equity focused, that understand that sports is a beautiful
Speaker 4: way to invest in non correlated growth assets. And so
Speaker 4: we're seeing a lot of money flocked to the space,
Speaker 4: and we're there to hopefully help put transactions together for
Speaker 4: our clients.
Speaker 3: It's certainly been a very interesting one to watch now.
Speaker 3: Almost a decade ago, I wrote a story for Bloomberg
Speaker 3: BusinessWeek called how to Automate an Investment Banker. At that time,
Speaker 3: I talked to your firm about what's possible and what's
Speaker 3: not possible, And at that time there are some things possible,
Speaker 3: but a lot that was not.
Speaker 1: How far have we come?
Speaker 3: What role is AI going to be? As you start
Speaker 3: to let's say build out Molus two point zero.
Speaker 4: Look, it's very critical for us to being on the
Speaker 4: cutting edge of technology and innovate and to adopt technologies
Speaker 4: that will help us serve our clients. AI has massive
Speaker 4: potential to help us be more efficient.
Speaker 1: It has massive potential to.
Speaker 4: Give us tools to be able to present better ideas
Speaker 4: to our clients and to help us execute those ideas
Speaker 4: on their behalf. Again, it's all about the clients, and
Speaker 4: you know, one of the things I'm excited about is
Speaker 4: to make sure within our organization we're staying on our
Speaker 4: front foot to incorporate those tools in our work to
Speaker 4: make sure that we're doing the very best job, you know,
Speaker 4: servicing our client base.
Speaker 3: Navid, we thank you so much for joining us here today.
Speaker 3: That is, of course Navin Momus out again of a
Speaker 3: Molism company. The incoming CEO Scarlett in his first interview
Speaker 3: since their role was announced.
Speaker 2: Thank you Schnoli Bask for that exclusive interview.