Morgan Stanley has poached Hugh Thomas from J.P. Morgan. Thomas, who headed the Asia-Pacific energy and natural resources group at J.P. Morgan, joins Morgan Stanley as a managing director in investment banking, with a mandate similar to what he had at J.P. Morgan. Morgan Stanley does not have a head of natural resources position.
Thomas is currently on gardening leave and will join Morgan Stanley towards the end of this year.
J.P. Morgan confirmed that Thomas has resigned, but had no further comment and did not indicate who will replace Thomas. Morgan Stanley had no comment on the hire.
Thomas joined J.P. Morgan in 2007 from Deloitte where he was a partner. He was earlier at KPMG corporate finance where he headed energy and natural resources for Australia and was also global head of mining. Thomas is a finance major and a registered chartered accountant.
Dealogic league tables rank J.P. Morgan fifth among all advisers on completed mergers and acquisitions in the natural resources sector for Asia-Pacific excluding Japan in 2008. This put the bank marginally ahead of Morgan Stanley which ranked sixth. Dealogic clubs deals from the metals and steel, mining, and oil and gas sectors into the natural resources category.
For 2009 year-to-date Morgan Stanley ranks ninth on completed M&A deals and first on announced deals, while J.P. Morgan does not rank in the top 10 on completed deals and is 10th on announced deals.
On equity capital markets deals, J.P. Morgan has been involved in the five largest natural resources ECM deals so far this year. J.P. Morgan Cazenove was a global coordinator on the $15.2 billion rights issue by Australian miner Rio Tinto, alongside Credit Suisse and Macquarie, while Morgan Stanley had a more junior role. J.P. Morgan also worked on the $2.4 billion follow-on by Santos in Australia, Indian mining firm Sterlite's $1.6 billion follow-on (which Morgan Stanley was also on), the $1.3 billion initial public offering by China Zhongwang Holdings and a $1.25 billion convertible bond issue by London-listed Vedanta Resources.
M&A in the sector seems set to continue as Chinese natural resources firms continue to strike deals to secure the supply of raw materials for the growing needs of the country's 1.3 billion-strong population.
Among other recent additions, Morgan Stanley last month hired Ronan McCullough from Goldman Sachs to head its bond and loan syndicate for Asia-Pacific.
Morgan Stanley will also witness a change in its top ranks shortly. The Wall Street investment bank said on Friday that current co-president James Gorman will become chief executive officer on January 1 next year. At that time, the current chairman and CEO John Mack will relinquish the CEO role, although he will continue as chairman for two more years.
Gorman, who will also join Morgan Stanley's board of directors, has pipped Morgan Stanley's other co-president Walid Chammah to the top job. Chammah will become chairman of Morgan Stanley International and will continue to be based in London.
Mack had already told Morgan Stanley's board 18 months ago that he would like to step down from the role of CEO when he turns 65. Gorman, who joined Morgan Stanley in 2006, was said to have emerged as the frontrunner in the past few months. Gorman joined from Merrill Lynch to oversee the global wealth management group. He subsequently took on the additional role of co-head of strategic planning. Gorman and Chammah were both promoted to co-president in November 2007. Gorman is currently also overseeing investment management, including the merchant bank, operations and technology. Gorman was instrumental in creating the Morgan Stanley Smith Barney joint venture earlier this year, which was generally considered to be a savvy strategic move for Morgan Stanley in the wealth management arena.
Gorman was a senior partner at consulting firm McKinsey before he joined Merrill Lynch in 2001. Specialists were generally positive on the appointment and say Gorman brings a unique blend of experience across consulting and banking to his new job.
