Ken Moelis to Step Down as CEO
Ken Maurice, a prominent figure in investment banking who started with Michael Milken’s company, has made significant strides at his own boutique bank valued at $4.6 billion. Recently, Moelis & Co. announced that he will be resigning as CEO.
In a press release, it was revealed that the 66-year-old Moelis will transition to the role of executive chair on October 1. He will continue to advise clients in this new position, which suggests he isn’t entirely stepping away.
Navid Mahmoodzadegan, aged 56, who is a co-founder and co-president of Moelis & Co., will join the bank’s board in the CEO’s stead. Jeff Raich, 58, will step up as co-founder and co-chairman as well as vice-chairman.
Interestingly, the boutique’s shares dropped by 1.9% on Monday morning.
Moelis expressed his ambition to ensure “the smoothest transition ever in Wall Street history,” even though the bank carries his name. Despite the seemingly positive outlook, planning for succession has been ongoing for years, with Moelis concentrating on nurturing younger bankers and solidifying client relationships.
It’s quite apparent that his legacy at Moelis & Co. was built alongside dedicated partners from the onset.
In a statement, Maurice stressed Mahmoodzadegan’s pivotal role, saying, “We are involved in every major decision we have made and he is a unique talent—one of the best strategic advisors I have ever worked for.”
Moelis kicked off his career in 1981 at Drexel Burnham Lambert under Milken. Here, he forged influential connections with figures like CNN founder Ted Turner and hotel mogul Steve Wynn.
After the collapse of Drexel in 1990, he moved to Donaldson, Lufkin & Jenrette, where he spent a decade rising to corporate finance chief, advising high-profile clients, including Donald Trump.
In 2000, following Drexel’s sale to Credit Suisse, Maurice transitioned to UBS, where Trump noted, “It’s not easy to lose a talent like Kenny.”
By 2007, Moelis had started his own firm with Mahmoodzadegan and Raich.
Moelis & Co quickly landed a significant contract with Hilton Hotels Corporation related to a $26 billion sale to the Blackstone Group in July 2007. This deal was particularly noteworthy as it illustrated the firm’s potential even amidst economic downturns.
During the financial crisis of 2008, contrary to many expectations, Moelis & Co expanded by hiring more staff, positioning itself uniquely against larger banks.
In 2014, Moelis exited, yet retained unique stocks and special rights, some of which were challenged and reduced by a judge last year.
In February, Moelis & Co saw its shares soar to an all-time high of nearly $80, though they have since dropped about 20% this year, impacted by political decisions and trade policies changing under the Trump administration.
In the past year, the Moelis firm has advised major clients, including Hailey Bieber’s skincare line Rhode, and recently facilitated a $1 billion deal for its sale to Elf Beauty.
Boutique firms like Moelis & Co have seen notable market share growth in recent years, according to LSEG data.
Moelis expressed surprise at how significant this business segment has become over the last two decades. Both he and Mahmoodzadegan share optimism about the future growth in this area.
Reflecting on his timing, Moelis noted, “It’s funny, you advise clients to do things at the right moment…and this is the right moment for the company.”
Mahmoodzadegan and Raich’s promotions to co-chairmen in September 2015 hint that the future leadership considerations were part of a long-term strategy.
The soon-to-be-former CEO has been instrumental in securing substantial deals for the bank across media, sports, and entertainment, highlighting his ongoing impact in the industry.
