Banking Capital Markets News

Cohen & Company Capital Markets Continues Strong Growth Despite Tumultuous Capital Market Environment

Cohen & Company Capital Markets Continues Strong Growth Despite Tumultuous Capital Market Environment

Leading M&A, Capital Markets, and SPAC Advisory Firm Promotes Five Senior Talents

Cohen & Company Capital Markets, a leading full-service boutique investment bank with a focus on mergers and acquisitions (M&A), capital markets, and SPAC advisory, closed out a strong 2022. CCM announced or closed transactions that represent over $18 billion in M&A volume and nearly $5 billion in capital raised, including nine successfully closed or announced private investments in private equity (PIPEs), raising $1.6 billion since the firm was founded in 2021.

Following a banner year of growth for CCM, the firm is pleased to announce the following promotions to its senior banking team:

  • Ken Taylor has been named vice chairman of cyber security investment banking. Ken has over 25 years of cyber industry experience as a senior executive and as a venture capitalist, including more than a decade of service in the military signal intelligence community.
  • Felix Burmeister has been named managing director of technology investment banking. Felix has more than 15 years of investment banking advisory experience, serving emerging, high-growth technology companies across M&A, private placements, IPOs, SPACs, and other capital markets transactions.
  • Christian Lopez has been named director of fintech investment banking and head of blockchain and digital assets. Christian has more than 10 years of investment banking and corporate finance experience, serving fintech and financial services companies across M&A, private placements, IPOs, SPACs, and other capital markets transactions.
  • Maggie Chou and Gen Takahashi have each been named vice presidents of investment banking.

“We are excited by the traction that CCM has achieved since launching in 2021,” said Dan Nash, co-founder and head of investment banking at CCM. “This year alone we nearly doubled our investment banking team and made several key appointments to expand our product and industry coverage teams. The strength of our team has been critical to our success in advising clients in such a volatile capital markets environment.”

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Driven by its commitment to execution excellence and first-class service, CCM was founded to address the coverage gaps and structural conflicts at leading investment banks. Outside of the firm’s expertise in M&A, capital markets, and SPAC advisory, CCM has teams with deep expertise in blockchain, digital assets, auto-tech, clean-tech, cyber security, and other emerging, high-growth industry verticals.

“We are focused on building a differentiated investment banking platform that leverages innovative thought leadership with unique product and industry expertise,” continued Nash. “CCM aims to be the first call advisor for clients, specifically in complex transactions and challenging market environments. We view having differentiated coverage and product bankers that can support our clients as an absolute imperative.”

Capital Markets 2022 Year in Review

Last year brought a dramatic shift to the capital formation markets: an ongoing inflation crisis that led to an unprecedented move in interest rates, combined with geopolitical turmoil, yielded a full year of elevated volatility and multiple compression in the equity markets. That backdrop led to a 95% decline in IPO volumes and 65% decline in secondary offerings, and the lightest new issuance market for equity in approximately 30 years1.

Credit issuance also struggled, with the high yield markets experiencing a 75% decline in volumes and the worst price performance in 40 years. New entrants to the equity market utilized SPACs in 2022, with over 100 business combinations closing, compared to fewer than 40 IPOs. However, SPAC combinations have been much smaller, and raising equity capital via PIPEs or non-redemptions has been significantly more challenging than in years past.

“Looking forward, we expect to see business combinations continue to outpace traditional IPOs in the first half of this year, while markets contend with the uncertain interest rate environment and risks of a recession,” said Jerry Serowik, CCM’s co-founder and head of Capital Markets at CCM. “SPACs offer a unique flexibility and allow for creative capital solutions, which are critical benefits to most issuers in the current backdrop.”

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Leading the 2022 DeSPAC League Tables

In only its second year, CCM was the leading advisor in the DeSPAC market across numerous roles and was the most active advisor in announced DeSPAC transactions2.

2022 Advisory Roles, per SPAC Insider Data

Rank

Advisor Name

Value ($M)

Market Share

Total Deal
Count

1

CCM

$7,409

4.3 %

13

2

Cantor Fitzgerald

$10,189

4.0 %

12

3

ARC Group

$6,804

4.0 %

12

4

Chardan

$4,656

4.7 %

12

5

EF Hutton

$4,174

4.3 %

12

6

Credit Suisse

$13,600

3.7 %

11

7

Barclays

$12,289

3.7 %

11

8

Stifel

$6,624

2.7 %

8

9

Oppenheimer

$4,651

2.7 %

8

10

Jefferies

$4,560

2.7 %

8

11

Citigroup

$11,090

2.3 %

7

12

B Riley Securities

$3,122

2.3 %

7

13

Cowen and Company

$4,672

2.0 %

6

14

Maxim Group

$905

2.3 %

6

15

RBC Capital Markets

$7,503

1.7 %

5

Total

$102,247

47.5 %

138

CCM was an advisor on a number of noteworthy transactions in 2022 including:

  • Shift Technologies, Inc.’s merger with CarLotz, Inc.
  • Athena Consumer Acquisition Corp. $913 million combination with Next e.GO Mobile
  • Sizzle Acquisition Corp. $813 million combination with Critical Metals Corp. that will result in the formation of Critical Metals Corp.
  • Rubicon Technologies $1.7 billion combination with Founders SPAC and $121 million PIPE

“We anticipate the IPO market to re-open in 2023 as volatility subsides, though smaller entrants without a substantial profitability profile will need to wait for further improvement in risk appetite,” shared Serowik. “We expect an increase in M&A activity mid-to-late in the year and elevated levels of business combinations. The DeSPAC activity can be attributed to the benefits of the SPAC process, lending itself to bringing creative capital solutions for smaller and earlier stage companies that will continue to be shut out of the IPO market. Additionally, SPACs are well positioned for more complicated stories and unique situations, including up-listing, cross listing, carveouts, and re-capitalizing public companies. Presently, there are hundreds of SPACs that are running out of time to achieve an acquisition. Longer term, we predict SPACs normalizing to higher volumes than historical levels pre-2020, but significantly less than the last three years.”

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[To share your insights with us, please write to sghosh@martechseries.com]

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