Nomura, the prominent Japanese investment bank, has made strategic moves to strengthen its coverage of the mobility and automotive sectors in Europe and the United States. The bank has hired two seasoned investment bankers to lead its efforts, aiming to tap into the burgeoning opportunities presented by the sustainability-focused Greentech division. As the industry undergoes a period of consolidation, Nomura aims to capitalize on the emergence of new companies, as well as established vehicle and equipment manufacturers. This move comes at a time when Wall Street is still reeling from the profound impact of special purpose acquisition companies (SPACs) in 2021.
Richard Hawwa Takes the Helm in San Francisco
Joining Nomura’s Greentech division, Richard Hawwa, an accomplished executive with experience in the self-driving truck industry, has assumed a vital role in San Francisco. Hawwa’s appointment reflects Nomura’s commitment to establishing a strong presence in the mobility sector, where cutting-edge technologies and innovative business models are redefining the industry landscape.
Alex Bleck to Lead the Frankfurt Team
In another strategic hire, Nomura has secured the services of Alex Bleck, who will take charge of the bank’s team in Frankfurt. Bleck, previously associated with Deutsche Bank AG, brings with him a wealth of expertise in investment banking. His appointment demonstrates Nomura’s intention to bolster its European operations and fortify its position in a highly competitive market.
Spotlight on Acquisition and Merger Opportunities
Duncan Williams, the global co-head of Nomura Greentech, believes that the future of many standalone young electric vehicle companies lies in being acquired by larger enterprises or merging with each other. As the industry evolves, consolidation becomes a crucial avenue for success and scale. Williams points to Bridgestone Corp’s recent acquisition of software firm Azuga Holdings as an example of the type of deals he expects to see more frequently. This trend indicates that industry suppliers are increasingly seeking to control various segments of the value chain.
EV Startups Face Challenges Amid Subsidies and Economic Uncertainty
While producers of low-emission vehicles and equipment are poised to benefit from substantial subsidies in numerous countries, EV startups such as Lucid and Nikola are grappling with a cash crunch. Higher borrowing costs and concerns about a potential recession have negatively impacted consumer sentiment, creating a challenging environment for these emerging companies. However, traditional automakers have responded by launching lower-priced electric models, and Tesla, the trailblazer in the EV space, has significantly reduced its prices, triggering a fierce price war within the industry.
Investment Banks Eye Lucrative Fees in the Mobility and Transportation Sector
In 2021, investment banks in Europe and the United States amassed over $700 million in fees from high-tech mobility and transportation deals. Duncan Williams predicts that these substantial fees will continue in the coming years, with an expected annual revenue of at least $300 million for Wall Street. Nomura, aiming to carve out a significant share in this lucrative market, is determined to capitalize on the continuity and potential growth of these fees.
Conclusion
Nomura’s strategic moves to bolster its Greentech division and expand its coverage of mobility and automotive clients signal the bank’s commitment to capitalizing on the evolving landscape of the industry. With Richard Hawwa at the helm in San Francisco and Alex Bleck leading the team in Frankfurt, Nomura is poised to make significant strides in serving clients in these key regions. As the mobility and automotive sectors undergo consolidation and face challenges such as cash crunches and price wars, Nomura aims to provide expertise and guidance to companies navigating this complex landscape. By leveraging its Greentech division and capitalizing on acquisition and merger opportunities, Nomura is well-positioned to secure its share of the ever-growing fees in the high-tech mobility and transportation sector.
