Thomas Weisel, the high-octane dealmaker who helped take many of Silicon Valley’s leading companies public, wants to do the same for his own firm, The Post has learned.
Thomas Weisel Partners – the technology-focused merchant banking boutique launched in 1999 by Weisel after he sold the firm he co-founded, Montgomery Securities, to Bank of America Corp. – is taking steps to prepare the firm for an initial public offering, sources said.
Weisel has already begun drawing up plans regarding the possible pricing and structure of an IPO for the firm, sources said.
It is unclear whether the firm has worked out other details, such as the allocation of equity awards and vesting schedules.
If the firm decides to go forward with the offering, Weisel Partners plans to file registration papers with the Securities and Exchange Commission as soon as next month.
The firm, which is thought to be leaning toward leading the IPO itself, has not yet retained additional underwriters to help with the offering.
Because Weisel is a private partnership, estimating a current valuation for the franchise is difficult.
In the past, Weisel set a valuation in his firm by selling minority stakes. In October 2001, Japan’s Nomura invested $75 million for a 3.75 percent stake in Weisel in a deal that valued the company at $2 billion.
Nearly two years earlier, U.S. pension fund California Public Employees Retirement System took a 10 percent stake for $100 million, valuing the company at $1 billion. Now, sources familiar with the firm say it will likely be worth closer to $500 million.
A Weisel spokeswoman declined comment.
In its plans to go public, Weisel would be following a path already paved by boutique advisory firm Greenhill & Co., which raised $87 million in its blockbuster initial offering last May. It would also presumably follow the planned share float by Lazard LLC, which is proceeding with its own IPO roadshow in April.
“The firm is hoping to replicate Greenhill’s success by capitalizing on Weisel’s tech-franchise brand name and the improving outlook for equity offerings,” one tech banker said.
To be sure, there are differences between Weisel and those two firms that could prove challenging for the merchant bank in its attempt to attract investors, sources say.
For one, the firm is not as diversified in the industries it covers, given its heavy tech bent. And unlike M&A specialists Lazard and Greenhill, Weisel is much more dependent on equity underwriting.
An IPO would offer several advantages for Weisel. It would give the firm currency to attract and retain top talent, as well as make strategic acquisitions.
Also it would help the firm raise capital to expand the business, and eventually provide liquidity for retiring partners.
While Weisel benefited from the boom in tech deals when it first opened, the firm saw its business sputter when the bubble burst in 2000 as IPOs and merger deals in the sector virtually dried up.
Weisel has seen business pick up in the last year or so.
Higher tech
Thomas Weisel Partners
Underwriting/Advisory business
2002 $3.6 billion
2003 $7.6 billion
2004 9.2 billion
Underwriting/Advisory fees
2003 $73 million
2004 $85.3 million
Wall Street figures
2003 $50 billion
2004 $55 billion
Source: Thomson Financial