Solomon Partners launches professional services unit in NY

By Isla Binnie and Milana Vinn

NEW YORK, July 8 (Reuters) - Solomon Partners is launching a unit to advise professional services businesses and has hired a new partner to cover them, the boutique firm said on Tuesday, betting that increased interest from private equity investors will fuel mergers and acquisitions in that sector.

Jonathan Hemmert joins the New York-based firm to drive the launch. Solomon, an affiliate of French bank Natixis, has approximately 180 bankers.

Unlike large multinationals such as Deloitte and PwC, many professional services firms — including consultants, accountants, and wealth managers — are smaller and could be attractive targets for buyers, Hemmert said.

"Many firms fall into the sweet spot in terms of sizing the opportunity for private equity platforms," he said, adding that he expects to see an increase in deal activity.

These businesses generate recurring revenues and hold valuable human capital, while many leaders are approaching retirement, which could prompt ownership changes, Hemmert said. "There is plenty of room for improvement in terms of efficiency of operations."

Prior to his new role, Hemmert led the broker-dealer and specialty advisory practice at Keefe, Bruyette & Woods. He has worked as a banker for more than 20 years, Solomon said in a statement.