The restructuring desks at the major boutique banks are cashing in on sponsor liability management work as private equity M&A business slows to a crawl.
Advisory firms Houlihan Lokey, PJT, Evercore, Moelis, Perella Weinberg and Lazard wrapped earnings this week. Nearly every chief executive said sponsors are reluctant to sell portfolio companies they bought at steep valuations during the market highs of 2020 and 2021, but that the same firms are the most active clients for liability management advice.
“We've had very strong success with the most sophisticated and repeat consumers of liability management services, which are private equity firms in the [alternatives] space,” PJT chief executive Paul Taubman said on an earnings call Tuesday. Lazard chief financial officer Tracy Farr last week said restructuring and liability management business for the first half was the highest in about a decade. Most of that business, chief executive Peter Orszag added, was liability management exercises.
As of March 2026, sponsors held 32,979 unsold portfolio companies globally, according to consultancy PwC. Deal volume by dollar value in the first half fell by a third compared to the prior year, reflecting a backlog of assets Bainsaid topped...
