Table of Contents
Filed Pursuant to Rule 424(b)(3)
Registration No. 333-160868
Registration No. 333-160868
Prospectus Supplement to Prospectus dated July 29,
2009.
3,000,000 Shares
Greenhill & Co.,
Inc.
Common Stock
All of the shares of our common stock in the offering are being
sold by the selling stockholders identified in this prospectus
supplement. We will not receive any of the proceeds from the
sale of the shares of our common stock being sold by the selling
stockholders.
Our common stock is listed on the New York Stock Exchange under
the symbol “GHL”. The last reported sale price of our
common stock on July 28, 2009 was $78.35 per share.
Investing in the common stock involves certain risks. See
“Risk Factors” beginning on page 6 of our annual
report on
Form 10-K
for the year ended December 31, 2008, which is incorporated
by reference into the accompanying prospectus.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved these
securities, or determined if this prospectus supplement or the
accompanying prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.
|
Per Share
|
Total
|
|||||||
|
Public offering price
|
$ | 76.00 | $ | 228,000,000 | ||||
|
Underwriting discount
|
$ | 2.47 | $ | 7,410,000 | ||||
|
Proceeds, before expenses, to the selling stockholders
|
$ | 73.53 | $ | 220,590,000 | ||||
To the extent that the underwriters sell more than
3,000,000 shares of common stock, the underwriters have the
option to purchase up to an additional 450,000 shares from
the selling stockholders on the same terms and conditions set
forth above.
Upon completion of this offering, our employees and their
affiliated entities will collectively own 33.0% of the total
shares of our common stock outstanding (or 31.4% if the
underwriters’ option to purchase additional shares is
exercised in full).
The underwriters expect to deliver the shares against payment in
New York, New York on August 4, 2009.
Goldman, Sachs &
Co.
| William Blair & Company | JMP Securities | Keefe, Bruyette & Woods | Sandler O’Neill + Partners, L.P. |
Prospectus Supplement dated July 30, 2009.
Table of Contents
ABOUT THIS
PROSPECTUS SUPPLEMENT
This document is in two parts. The first part is this prospectus
supplement, which describes the specific terms of this offering
of our common stock. The second part, the accompanying
prospectus, gives more general information about the common
stock certain of our stockholders may offer from time to time.
If there is any inconsistency between the information in this
prospectus supplement and the accompanying prospectus, you
should rely on the information in this prospectus supplement.
The terms “Greenhill”, “we”, “us”,
and “our” refer to Greenhill & Co., Inc.
and, unless the context otherwise requires, its consolidated
subsidiaries.
No dealer, salesperson or other person is authorized to give any
information or to represent anything not contained in this
prospectus supplement or the accompanying prospectus. You must
not rely on any unauthorized information or representations.
This prospectus supplement is an offer to sell only the shares
offered hereby, but only under circumstances and in
jurisdictions where it is lawful to do so. The information
contained in this prospectus supplement is current only as of
its date.
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PROSPECTUS
SUPPLEMENT SUMMARY
This summary highlights information contained elsewhere in
this prospectus supplement and the accompanying prospectus. This
summary does not contain all of the information you should
consider before investing in our common stock. You should read
this prospectus supplement, the accompanying prospectus and the
documents incorporated by reference carefully, especially the
risks of investing in our common stock discussed in the
incorporated documents.
Greenhill
Overview
Greenhill is an independent investment banking firm that
(i) provides financial advice on significant mergers,
acquisitions, restructurings and similar corporate finance
matters as well as fund placement services for private equity
and other financial sponsors and (ii) manages merchant
banking funds and similar vehicles and commits capital to those
funds and vehicles. We act for clients located throughout the
world from offices in New York, London, Frankfurt, Toronto,
Tokyo, Chicago, Dallas, Los Angeles and San Francisco and
will open an office in Houston shortly.
We were established in 1996 by Robert F. Greenhill, the former
President of Morgan Stanley and former Chairman and Chief
Executive of Smith Barney. Since its founding, Greenhill has
grown steadily, recruiting a number of managing directors from
major investment banks (as well as senior professionals from
other institutions), with a range of geographic, industry or
transaction specialties and different sets of corporate
management and other relationships. As part of this expansion,
we opened a London office in 1998, raised our first merchant
banking fund in 2000, opened a Frankfurt office later in 2000
and began offering financial restructuring advice in 2001. On
May 11, 2004, we converted from a limited liability company
to a corporation and completed an initial public offering of our
common stock. We opened our Dallas office and completed the
closing of our second merchant banking fund in 2005. We opened
our Toronto office and completed the final closing of our first
venture capital fund in 2006. In 2007, we completed the final
closing of our first European merchant banking fund. We
completed the initial public offering of our special purpose
acquisition company, GHL Acquisition Corp., in February 2008,
opened our San Francisco office in April 2008, launched our
Fund Placement Advisory Group in May 2008, opened our Tokyo
office in October 2008 and opened our Chicago office in December
2008. In the first half of 2009, we announced the formation of
our Financing Advisory & Restructuring Group in New
York and London, opened our Los Angeles office and will open a
Houston office shortly. As of June 30, 2009, we employed 69
managing directors and senior advisors globally, 26 of whom were
hired in the 18 months ending that date, essentially
doubling our managing director headcount in financial advisory.
We expect to seek to continue to add industry-focused senior
employees and to expand geographically.
Principal Sources
of Revenue
Our principal sources of revenue are financial advisory services
and merchant banking.
Advisory
Revenue
Our financial advisory business consists of mergers and
acquisitions, financing advisory and restructuring, and fund
placement advisory. For all of our financial advisory services,
we draw on the extensive experience, corporate relationships and
industry expertise of our managing directors and senior advisors.
On mergers and acquisitions engagements, we provide a broad
range of advice to global clients in relation to domestic and
cross-border mergers, acquisitions, and similar corporate
finance matters and are generally involved at each stage of
these transactions, from initial structuring to final execution.
Our focus is on providing high-quality advice to senior
executive management and boards
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of directors of prominent large and mid-cap companies in
transactions that typically are of the highest strategic and
financial importance to those companies. We advise clients on
strategic matters, including acquisitions, divestitures,
defensive tactics, special committee assignments and other
important corporate events. We provide advice on valuation,
tactics, industry dynamics, structuring alternatives, timing and
pricing of transactions, and financing alternatives. Where
requested to do so, we may provide an opinion regarding the
fairness of a transaction.
In our financing advisory and restructuring practice, we advise
debtors, creditors and companies experiencing financial distress
as well as potential acquirors of distressed companies and
assets. We provide advice on valuation, restructuring
alternatives, capital structures, and sales or
recapitalizations. We also assist those clients who seek
court-assisted reorganizations by developing and seeking
approval for plans of reorganization as well as the
implementation of such plans.
In our fund placement advisory practice we assist private equity
funds and other financial sponsors in raising capital from a
global set of institutional and other investors.
Financial advisory revenues accounted for 96%, 98% and 92% of
our revenues in the six months ended June 30, 2009 and in
fiscal years 2008 and 2007, respectively.
Non-U.S. clients
are a significant part of our business, generating 28%, 53% and
64% of our financial advisory revenues for the six months ended
June 30, 2009 and in fiscal years 2008 and 2007,
respectively. We generate revenues from our financial advisory
services by charging our clients fees consisting principally of
fees paid upon the commencement of an engagement, fees paid upon
the announcement of a transaction, fees paid upon the successful
conclusion of a transaction or closing of a fund and, in
connection principally with restructuring assignments, monthly
retainer fees.
Merchant Banking
and Other
Our merchant banking activities currently consist primarily of
management of and investment in Greenhill’s merchant
banking funds, Greenhill Capital Partners I (or “GCP
I”), Greenhill Capital Partners II (or “GCP
II”, and collectively with GCP I, “Greenhill
Capital Partners” or “GCP”), Greenhill SAV
Partners (or “GSAVP”) and Greenhill Capital Partners
Europe (or “GCP Europe”), which are families of
merchant banking funds that invest in portfolio companies.
Merchant banking funds are private investment funds raised from
contributions by qualified institutional investors and
financially sophisticated individuals. The funds generally make
investments in non-public companies, typically with a view
toward divesting within 3 to 5 years. We pursue merchant
banking and other investment activities in addition to our
financial advisory activities because we believe merchant
banking can generate attractive returns on the firm’s
capital, and because it allows us to further leverage our
managing directors’ industry knowledge and corporate
relationships. We believe we can pursue merchant banking
opportunities without creating conflicts with our advisory
clients by typically focusing on significantly smaller companies
than those with respect to which we seek to provide financial
advice. GCP typically makes controlling or influential minority
investments of $10 million to $75 million in companies
with valuations that are between $50 million and
$500 million at the time of investment. GCP has invested a
substantial portion of its capital in the energy, financial
services and telecommunications industries. GSAVP typically
makes smaller investments in early-growth-stage companies that
offer technology-enabled or business information services. Such
investments typically involve higher levels of risk and are more
speculative than our GCP investments. GCP Europe typically makes
controlling or influential minority investments of
£10 million to £30 million in companies with
valuations that are between £50 million and
£250 million at the time of investment.
Merchant banking and other revenue accounted for 4%, 2% and 8%
of our revenues in the six months ended June 30, 2009 and
in fiscal years 2008 and 2007, respectively. We generate
merchant banking revenue from (i) management fees paid by
the funds we manage, (ii) gains (or losses) on our
investments in the merchant banking funds and other principal
investment activities, and (iii) merchant banking profit
overrides. We charge management fees in GCP II, GSAVP and GCP
Europe to all investors except the firm. In GCP I, we
charge management fees to all outside investors who are not
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employed or affiliated with us. We may also generate gains (or
losses) from our capital investment in our merchant banking
funds depending upon the performance of the funds. Our
investments in our merchant banking funds generate realized and
unrealized investment gains (or losses) based on our allocable
share of earnings generated by the funds. As the general partner
of our merchant banking funds we make investment decisions for
the funds and are entitled to receive an override on the profits
of the funds after certain performance hurdles are met.
We began our merchant banking activities in 2000 with the
establishment of GCP I, which had total committed capital
of $423 million. In 2005 we closed our second merchant
banking fund, GCP II, which had total committed capital of
$875 million. The firm has committed approximately 10%, or
$88.5 million, to GCP II and our managing directors and
other employees have committed an additional $136 million
to that fund. In 2006 we expanded our merchant banking
activities with the closing of our venture capital fund, GSAVP,
which had total committed capital of $101.5 million. The
firm has committed $10.9 million to GSAVP and our managing
directors and other employees have committed an additional
$22.6 million to that fund. In 2007, we closed our first
European merchant banking fund, GCP Europe, which had total
committed capital of approximately £191 million. The
firm has committed £25 million to GCP Europe and our
managing directors and other employees have committed an
additional £41.9 million
In February 2008, GHL Acquisition Corp. (“GHLAC”), a
blank check company sponsored by the firm, completed its initial
public offering, selling 40,000,000 units for an aggregate
purchase price of $400 million. We originally invested
$8.0 million in GHLAC and owned approximately 17.3% of its
outstanding common stock (AMEX:GHQ) upon consummation of the
offering. In September 2008, GHLAC announced that it had agreed
to acquire Iridium Holdings, L.L.C. (“Iridium”), a
leading provider of voice and data mobile satellite services, at
an enterprise value of approximately $591 million, subject
to stockholder approval, various regulatory approvals and other
customary closing conditions. In October 2008, we invested
$22.9 million in a convertible subordinated note issued by
Iridium. During the second quarter of 2009, GHLAC reached an
agreement to reduce by 15% the consideration to be paid in its
planned acquisition of Iridium. In July 2009, GHLAC reached
agreement with certain warrant holders, including Greenhill, to
repurchase or restructure their GHLAC warrants upon closing of
its acquisition of Iridium. If the acquisition of Iridium by
GHLAC is completed on the agreed terms and our investment in
Iridium is converted to GHLAC common shares, based on
GHLAC’s current capitalization we will own approximately
8.9 million common shares, or 10.6% of the combined
company’s common stock, assuming exercise of all currently
in-the-money warrants and approval by all GHLAC shareholders of
the acquisition. We would also own 4.0 million
out-of-the-money warrants of the combined company. The
acquisition of Iridium remains subject to Federal Communications
Commission approval as well as approval by GHLAC shareholders.
Our principal executive offices are located at 300 Park Avenue,
23rd
Floor, New York, New York 10022, and our telephone
number is
(212) 389-1500.
We maintain a website at www.greenhill.com where general
information about us is available. We are not incorporating the
contents of the website into this prospectus supplement.
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THE
OFFERING
|
Common stock offered by the selling stockholders
|
3,000,000 shares | |
|
Common stock outstanding after this offering(1)
|
28,156,741 shares | |
|
Underwriters’ option to purchase additional shares from the
selling stockholders
|
450,000 shares | |
|
Voting rights
|
One vote per share | |
|
Offering price
|
$76.00 per share | |
|
Use of proceeds
|
We will not receive any proceeds from this offering. | |
|
Dividend policy
|
In January 2009, our Board of Directors declared a dividend of $0.45 per share, which was paid on March 18, 2009 to stockholders of record as of March 4, 2009; in April 2009, our Board of Directors declared a dividend of $0.45 per share, which was paid on June 10, 2009 to stockholders of record as of May 27, 2009; and in July 2009, our Board of Directors declared a dividend of $0.45 per share, which is payable on September 16, 2009 to stockholders of record as of September 2, 2009. Purchasers of common stock in this offering will be entitled to receive these previously declared and unpaid dividends in September 2009 if they are stockholders of record as of September 2, 2009. The declaration of any future dividends and, if declared, the amount of any such dividends, will be subject to our actual future earnings and capital requirements and to the discretion of our Board of Directors. For a discussion of the factors that will affect the determination by our Board of Directors to declare dividends, see “Dividend Policy”. | |
| New York Stock Exchange symbol | GHL |
| (1) | The number of shares of common stock that will be outstanding after this offering is based on the number of shares outstanding at July 24, 2009; and excludes: |
| • | 208,418 non-voting exchangeable shares, which are exchangeable into the same number of shares of common stock of the Company, subject to certain conditions, and 2,517,507 unvested restricted stock units, which vest over time and represent a right to a future payment equal to one share of common stock per restricted stock unit. |
Unless we specifically state otherwise, the information in this
prospectus supplement does not take into account the sale of up
to 450,000 shares of common stock that the underwriters
have the option to purchase from the selling stockholders.
Except as otherwise indicated, all amounts with respect to the
volume, number and market share of mergers and acquisitions
transactions and related ranking information incorporated by
reference into this prospectus supplement or the accompanying
prospectus have been derived from information compiled and
classified by Thomson Financial.
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USE OF
PROCEEDS
The selling stockholders will receive all of the net proceeds
from the sale of the shares of common stock offered hereby. We
will not receive any proceeds from the offering contemplated by
this prospectus supplement.
DIVIDEND
POLICY
Dividends declared per common share were $1.80 in the aggregate
in 2008. Dividend equivalents of $3.4 million were recorded
in 2008 on the restricted stock units that are expected to vest.
Additionally, in January 2009, April 2009 and July 2009 our
Board of Directors declared separate quarterly dividends of
$0.45 per share, for an aggregate of $1.35 per share. The
dividend declared in July 2009 is payable on September 16,
2009 to stockholders of record as of September 2, 2009.
Purchasers of common stock in this offering will be entitled to
receive these previously declared and unpaid dividends in
September 2009 if they are stockholders of record as of
September 2, 2009.
The declaration of any dividend and, if declared, the amount of
any such dividend, will be subject to our actual future earnings
and capital requirements and to the discretion of our Board of
Directors. Our Board of Directors will take into account such
matters as general business conditions, our financial results,
capital requirements, contractual, legal and regulatory
restrictions on the payment of dividends by us to our
stockholders or by our subsidiaries to us, and such other
factors as our Board of Directors may deem relevant.
CAPITALIZATION
The following table sets forth our capitalization as of
June 30, 2009. This table should be read in conjunction
with “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” and the
consolidated financial statements and notes thereto included in
each of our annual report on
Form 10-K
for the year ended December 31, 2008 and our quarterly
report on
Form 10-Q
for the three months ended June 30, 2009, each of which is
incorporated by reference in this prospectus supplement. Our
capitalization will not be affected by this offering.
|
As of |
||||
|
June 30, 2009
|
||||
|
Cash and cash equivalents
|
$ | 55,048,701 | ||
|
Bank loan payable
|
33,375,000 | |||
|
Stockholders’ equity:
|
||||
|
Common stock, par value $0.01 per share; 100,000,000 shares
authorized, 33,120,076 shares issued and outstanding(1)
|
331,201 | |||
|
Restricted stock units
|
69,886,518 | |||
|
Additional paid-in capital
|
224,682,364 | |||
|
Exchangeable shares of subsidiary; 257,156 shares issued
and 208,418 outstanding
|
12,442,555 | |||
|
Retained earnings
|
185,818,041 | |||
|
Accumulated other comprehensive income (loss)
|
(10,477,878 | ) | ||
|
Treasury stock, at cost, par value $0.01 per share;
4,964,133 shares
|
(267,086,584 | ) | ||
|
Total stockholders’ equity
|
215,596,217 | |||
|
Total capitalization
|
$ | 248,971,217 | ||
| (1) | Includes 4,964,133 shares repurchased and held in treasury as of June 30, 2009. |
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SELLING
STOCKHOLDERS
Managing directors and senior advisors of Greenhill or their
affiliates are offering the 3,000,000 shares of common
stock being offered hereby.
The following table sets forth as of the date of this prospectus
supplement certain information regarding the number of shares of
common stock to be sold in the offering by each selling
stockholder and each selling stockholder’s beneficial
ownership of our common stock:
| • | immediately prior to the consummation of this offering; and | |
| • | as adjusted to reflect the sale of the shares of our common stock by the selling stockholders. |
Each selling stockholder is a managing director or a senior
advisor of Greenhill or an affiliate thereof. In accordance with
the rules of the Securities and Exchange Commission,
“beneficial ownership” includes voting or investment
power with respect to securities. The percentage of beneficial
ownership reflected in the following table is based on
28,156,741 shares of common stock outstanding as of
July 24, 2009. The address for each listed stockholder is:
c/o Greenhill &
Co., Inc., 300 Park Avenue, 23rd Floor, New York, New York
10022. To our knowledge, except as indicated in the footnotes to
this table and pursuant to applicable community property laws,
the persons named in the table have sole voting and investment
power with respect to all shares of common stock beneficially
owned by them.
|
Shares Beneficially |
||||||||||||||||||||||||
|
Owned Before This |
Shares of Common Stock to |
Shares Beneficially Owned |
||||||||||||||||||||||
| Offering | be Sold(1) | After Offering(1) | ||||||||||||||||||||||
|
Selling Stockholders
|
Number
|
Percent
|
Number
|
Percent
|
Number
|
Percent
|
||||||||||||||||||
|
Robert F. Greenhill(2)
|
4,023,762 | 14.3% | 1,035,667 | 3.7% | 2,988,095 | 10.6% | ||||||||||||||||||
|
Scott L. Bok(3)
|
1,268,114 | 4.5% | 326,396 | 1.2% | 941,718 | 3.3% | ||||||||||||||||||
|
Simon A. Borrows(4)
|
1,275,478 | 4.5% | 328,292 | 1.2% | 947,186 | 3.4% | ||||||||||||||||||
|
Robert H. Niehaus(5)
|
948,308 | 3.4% | 242,924 | 0.9% | 705,384 | 2.5% | ||||||||||||||||||
|
Timothy M. George(6)
|
1,247,141 | 4.4% | 320,998 | 1.1% | 926,143 | 3.3% | ||||||||||||||||||
|
James R. C. Lupton(7)
|
1,259,030 | 4.5% | 324,058 | 1.2% | 934,972 | 3.3% | ||||||||||||||||||
|
Jeffrey F. Buckalew
|
145,577 | 0.5% | 37,470 | 0.1% | 108,107 | 0.4% | ||||||||||||||||||
|
Bradley J. Crompton(8)
|
104,209 | 0.4% | 26,822 | 0.1% | 77,387 | 0.3% | ||||||||||||||||||
|
Ulrika Ekman
|
26,032 | 0.1% | 6,700 | 0.0% | 19,332 | 0.1% | ||||||||||||||||||
|
George C. Estey(9)
|
104,209 | 0.4% | 26,822 | 0.1% | 77,387 | 0.3% | ||||||||||||||||||
|
Richard D. Lieb
|
25,321 | 0.1% | 6,517 | 0.0% | 18,804 | 0.1% | ||||||||||||||||||
|
Gregory R. Miller
|
102,163 | 0.4% | 26,295 | 0.1% | 75,868 | 0.3% | ||||||||||||||||||
|
Richard Morse
|
165,014 | 0.6% | 42,473 | 0.2% | 122,541 | 0.4% | ||||||||||||||||||
|
V. Frank Pottow
|
103,722 | 0.4% | 26,697 | 0.1% | 77,025 | 0.3% | ||||||||||||||||||
|
Gregory G. Randolph(10)
|
107,929 | 0.4% | 27,780 | 0.1% | 80,149 | 0.3% | ||||||||||||||||||
|
Bradley A. Robins
|
157,345 | 0.6% | 40,499 | 0.1% | 116,846 | 0.4% | ||||||||||||||||||
|
Harold J. Rodriguez, Jr.(11)
|
82,285 | 0.3% | 10,000 | 0.0% | 72,285 | 0.3% | ||||||||||||||||||
|
Colin T. Roy
|
557,874 | 2.0% | 143,590 | 0.5% | 414,284 | 1.5% | ||||||||||||||||||
|
Total
|
11,703,513 | 41.6% | 3,000,000 | 10.7% | 8,703,513 | 30.9% | ||||||||||||||||||
| (1) | Assumes that the underwriters have not exercised their option to purchase up to 450,000 shares of common stock in full. | |
| (2) | Robert F. Greenhill’s beneficial ownership is calculated by attributing to him all shares of our common stock he owns as well as those that are owned by two entities controlled by him. The first entity is Greenhill Family Limited Partnership, a Delaware limited partnership, which owns 3,214,511 of our shares of which 833,724 shares will be sold in this offering. The second entity is Riversville Aircraft Corporation II, a Delaware corporation, which owns 778,612 of our shares of which 201,943 shares will be sold in this offering. Mr. Greenhill expressly disclaims beneficial |
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| ownership of the shares of common stock held by members of his family in Greenhill Family Limited Partnership. | ||
| (3) | Includes 138,000 shares owned by the Bok Family Foundation, of which 32,640 shares will be sold by the Bok Family Foundation in this offering. | |
| (4) | Includes 2,150 shares transferred to St. Catherine’s School Bramley, all of which will be sold in this offering. | |
| (5) | Includes 60,000 shares owned by the Robert H. Niehaus and Kate Niehaus Foundation (“Niehaus Foundation”), 40,000 of which will be sold by the Niehaus Foundation in this offering and 450,000 shares held by the Robert H Niehaus 2008 GRAT, 202,924 of which will be sold by the Niehaus Foundation in this offering. It also includes 433,808 shares held directly by Mr. Niehaus and 4,500 shares held in three trusts of which Mr. Niehaus’ children are beneficiaries. Mr. Niehaus expressly disclaims beneficial ownership of the 4,500 shares of common stock held by the trusts and the GRAT except to the extent of his pecuniary interest therein. | |
| (6) | Includes 110,224 shares held in two trusts of which Mr. George is a co-trustee. The trusts will sell in aggregate 28,370 shares in this offering. | |
| (7) | Includes 2,200 shares transferred to Winchester College, all of which will be sold in this offering and 236,430 shares owned by Mr. Lupton’s wife. | |
| (8) | Mr. Crompton currently holds 104,209 shares of non-voting exchangeable shares issued by our Canadian subsidiary, which are exchangeable into the same number of shares of our common stock subject to certain conditions. | |
| (9) | Mr. Estey currently holds 104,209 shares of non-voting exchangeable shares issued by our Canadian subsidiary, which are exchangeable into the same number of shares of our common stock subject to certain conditions. | |
| (10) | Includes 250 shares transferred to the Trustees of Tufts College, all of which will be sold in this offering. | |
| (11) | Includes 24,981 shares owned by Mr. Rodriguez’s wife, of which 10,000 shares will be sold in this offering. |
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CERTAIN MATERIAL
U.S. FEDERAL TAX CONSEQUENCES
The following discussion describes certain material
U.S. federal income and estate tax consequences of the
ownership and disposition of our common stock. This discussion
applies only to holders that hold shares of our common stock as
capital assets.
This discussion does not describe all of the tax consequences
that may be relevant to a holder in light of its particular
circumstances or to holders subject to special rules, such as:
| • | certain financial institutions; | |
| • | insurance companies; | |
| • | dealers and certain traders in securities; | |
| • | persons holding our common stock as part of a “straddle”, “hedge”, “conversion” or similar transaction; | |
| • | U.S. holders (as defined below) whose functional currency is not the U.S. dollar; | |
| • | holders that own, or that are deemed to own, more than 5% of our common stock; | |
| • | certain former citizens or residents of the United States; | |
| • | partnerships or other entities classified as partnerships for U.S. federal income tax purposes; or | |
| • | persons subject to the alternative minimum tax. |
This discussion is based on the Internal Revenue Code of 1986,
as amended (the “Code”), and administrative
pronouncements, judicial decisions and final, temporary and
proposed Treasury Regulations, changes to any of which
subsequent to the date of this prospectus supplement may affect
the tax consequences described herein. This discussion does not
address all aspects of U.S. federal taxation that may be
relevant to holders in light of their particular circumstances
and does not address any tax consequences arising under the laws
of any state, local or foreign jurisdiction. Prospective holders
are urged to consult their tax advisors with respect to the
particular tax consequences to them of owning and disposing of
common stock, including the consequences under the laws of any
state, local or foreign jurisdiction.
Tax Consequences
to U.S. Holders
As used herein, the term “U.S. holder” means a
beneficial owner of our common stock that is, for
U.S. federal income tax purposes:
| • | a citizen or resident of the United States; | |
| • | a corporation, or other entity taxable as a corporation, created or organized in or under the laws of the United States or of any political subdivision thereof; or | |
| • | an estate or trust the income of which is subject to U.S. federal income taxation regardless of its source. |
Taxation of
Distributions on Common Stock
Distributions paid on our common stock, other than certain pro
rata distributions of common shares, will be treated as
dividends to the extent paid out of current or accumulated
earnings and profits (as determined under U.S. federal
income tax principles) and will be includible in income by the
U.S. holder and taxable as ordinary income when actually or
constructively received. If a distribution exceeds our current
and accumulated earnings and profits, the excess will be first
treated as a tax-free return of the U.S. holder’s
investment, up to the U.S. holder’s adjusted tax basis
in the common stock. Any remaining excess will be treated as a
capital gain. Subject to certain limitations and
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restrictions, dividends received by corporate U.S. holders
will be eligible for the dividends received deduction. For
taxable years beginning on or before December 31, 2010,
dividends received by certain noncorporate U.S. holders on
common stock may be subject to U.S. federal income tax at
lower rates than other types of ordinary income if certain
conditions are met. U.S. holders should consult their own
tax advisers regarding the application of these lower rates in
their particular circumstances.
Sale or Other
Disposition of Common Stock
Gain or loss realized by a U.S. holder on the sale or other
disposition of our common stock will be capital gain or loss for
U.S. federal income tax purposes, and will be long-term
capital gain or loss if the U.S. holder’s holding
period for the common stock is greater than one year. The amount
of the U.S. holder’s gain or loss will be equal to the
difference between the U.S. holder’s adjusted tax
basis in the common stock disposed of and the amount realized on
the disposition. Long-term capital gains recognized by
non-corporate U.S. holders are taxed at reduced rates under
current law. The deductibility of capital losses may be subject
to limitations.
Tax Consequences
to Non-U.S.
Holders
As used herein, the term
“non-U.S. holder”
means a beneficial owner of our common stock that is, for
U.S. federal income tax purposes:
| • | an individual who is classified as a nonresident alien; | |
| • | a foreign corporation; or | |
| • | a foreign estate or trust. |
A
non-U.S. holder
does not include an individual who is present in the United
States for 183 days or more in the taxable year of
disposition and is not otherwise a resident of the United States
for U.S. federal income tax purposes. Such an individual is
urged to consult his or her own tax advisor regarding the
U.S. federal income tax consequences of the sale, exchange
or other disposition of common stock.
Dividends
Dividends paid by us to a
non-U.S. holder
of common stock generally will be subject to withholding tax at
a 30% rate or a reduced rate specified by an applicable income
tax treaty. In order to obtain a reduced rate of withholding, a
non-U.S. holder
will be required to provide an Internal Revenue Service
Form W-8BEN
certifying its entitlement to benefits under a treaty.
The withholding tax does not apply to dividends paid to a
non-U.S. holder
who provides a
Form W-8ECI,
certifying that the dividends are effectively connected with the
non-U.S. holder’s
conduct of a trade or business within the United States.
Instead, the effectively connected dividends will be subject to
regular U.S. income tax, generally in the same manner as if
the
non-U.S. holder
were a U.S. resident. A
non-U.S. corporation
receiving effectively connected dividends may also be subject to
an additional “branch profits tax” imposed at a rate
of 30% (or a lower treaty rate).
Gain on
Disposition of Common Stock
A
non-U.S. holder
generally will not be subject to U.S. federal income tax on
gain realized on a sale or other disposition of common stock
unless:
| • | the gain is effectively connected with a trade or business of the non-U.S. holder in the United States (in which case, the non-U.S. holder will be taxed generally in the same manner as a U.S. holder), subject to an applicable treaty providing otherwise; or |
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| • | Greenhill is or has been a U.S. real property holding corporation at any time within the five-year period preceding the disposition or the non-U.S. holder’s holding period, whichever period is shorter, and its common stock has ceased to be regularly traded on an established securities market. |
Greenhill believes that it is not, and does not anticipate
becoming in the foreseeable future, a U.S. real property
holding corporation.
Federal Estate
Tax
An individual
non-U.S. holder
who is treated as the owner of, or has made certain lifetime
transfers of, an interest in the common stock will be required
to include the value of the stock in his or her gross estate for
U.S. federal estate tax purposes, and may be subject to
U.S. federal estate tax, unless an applicable estate tax
treaty provides otherwise.
Backup
Withholding and Information Reporting
Information returns and reports may be filed with the IRS in
connection with payments of dividends on the common stock and
the proceeds from a sale or other disposition of the common
stock. A U.S. holder may be subject to United States backup
withholding on these payments if it fails to provide its
taxpayer identification number to the paying agent and comply
with certification procedures or otherwise establish an
exemption from backup withholding. A
non-U.S. holder
may be subject to U.S. backup withholding on these payments
if it fails to comply with certification procedures to establish
that it is not a U.S. person. The amount of any backup
withholding from a payment will be allowed as a credit against
the holder’s U.S. federal income tax liability and may
entitle the holder to a refund, provided that the required
information is timely furnished to the IRS.
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UNDERWRITING
We, the selling stockholders and the underwriters named below
have entered into an underwriting agreement with respect to the
shares being offered. Subject to certain conditions, each
underwriter has severally agreed to purchase the number of
shares indicated in the following table. Goldman,
Sachs & Co. is the representative of the underwriters.
|
Number of |
||||
|
Underwriters
|
Shares
|
|||
|
Goldman, Sachs & Co.
|
2,250,000 | |||
|
William Blair & Company, L.L.C.
|
187,500 | |||
|
JMP Securities LLC
|
187,500 | |||
|
Keefe, Bruyette & Woods, Inc.
|
187,500 | |||
|
Sandler O’Neill & Partners, L.P.
|
187,500 | |||
|
Total
|
3,000,000 | |||
The underwriters are committed to take and pay for all of the
shares being offered, if any are taken, other than the shares
covered by the option described below unless and until this
option is exercised.
If the underwriters sell more shares than the total number set
forth in the table above, the underwriters have an option to buy
up to an additional 450,000 shares from the selling
stockholders to cover such sales. They may exercise that option
for 30 days from the date of this prospectus supplement. If
any shares are purchased pursuant to this option, the
underwriters will severally purchase shares in approximately the
same proportion as set forth in the table above.
The following table shows the per share and total underwriting
discounts and commissions to be paid to the underwriters by the
selling stockholders. Such amounts are shown assuming both no
exercise and full exercise of the underwriters’ option to
purchase 450,000 additional shares.
|
Paid by the Selling
Stockholders
|
No Exercise
|
Full Exercise
|
||||||
|
Per Share
|
$ | 2.47 | $ | 2.47 | ||||
|
Total
|
$ | 7,410,000 | $ | 8,521,500 | ||||
Shares sold by the underwriters to the public will initially be
offered at the initial price to the public set forth on the
cover of this prospectus supplement. Any shares sold by the
underwriters to securities dealers may be sold at a discount of
up to $2.22 per share from the public offering price. If
all the shares are not sold at the public offering price, the
representative may change the offering price and the other
selling terms. The offering of the Shares by the underwriters is
subject to receipt and acceptance and subject to the
underwriters’ right to reject any order in whole or in part.
Each of Greenhill, its directors and officers and the selling
stockholders have agreed with the underwriters, subject to
certain exceptions, not to dispose of, pledge or hedge any of
their common stock or securities convertible into or
exchangeable for shares of common stock during the period from
the date of this prospectus supplement continuing through a date
that is not less than nine months after the date of this
prospectus supplement, except with the prior written consent of
Goldman, Sachs & Co. This agreement does not apply to
the shares of common stock underlying any of the restricted
stock units received by other employees of Greenhill.
In connection with the offering, the underwriters may purchase
and sell shares of common stock in the open market. These
transactions may include short sales, stabilizing transactions
and purchases to cover positions created by short sales. Short
sales involve the sale by the underwriters of a greater number
of shares than they are required to purchase in the offering.
“Covered” short sales are sales made in an amount not
greater than the underwriters’ option to purchase
additional shares from the selling stockholders in the offering.
The underwriters may close out any covered short position by
either exercising their option to purchase additional shares or
purchasing shares in the open market. In determining the source
of shares to close out the covered short position, the
underwriters will consider, among other things, the price of
shares available for purchase in the open
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market as compared to the price at which they may purchase
additional shares pursuant to the option granted to them.
“Naked” short sales are any sales in excess of such
option. The underwriters must close out any naked short position
by purchasing shares in the open market. A naked short position
is more likely to be created if the underwriters are concerned
that there may be downward pressure on the price of the common
stock in the open market after pricing that could adversely
affect investors who purchase in the offering. Stabilizing
transactions consist of various bids for or purchases of common
stock made by the underwriters in the open market prior to the
completion of the offering.
The underwriters may also impose a penalty bid. This occurs when
a particular underwriter repays to the underwriters a portion of
the underwriting discount received by it because the
representative has repurchased shares sold by or for the account
of such underwriter in stabilizing or short covering
transactions.
Purchases to cover a short position and stabilizing
transactions, as well as other purchases by the underwriters for
their own accounts, may have the effect of preventing or
retarding a decline in the market price of the common stock, and
together with the imposition of the penalty bid, may stabilize,
maintain or otherwise affect the market price of the common
stock. As a result, the price of the common stock may be higher
than the price that otherwise might exist in the open market. If
these activities are commenced, they may be discontinued at any
time. These transactions may be effected on the New York Stock
Exchange, in the
over-the-counter
market or otherwise.
Each of the underwriters has represented and agreed that:
(a) it has only communicated or caused to be communicated
and will only communicate or cause to be communicated an
invitation or inducement to engage in investment activity
(within the meaning of section 21 of FSMA) to persons who
have professional experience in matters relating to investments
falling within Article 19(5) of the Financial Services and
Markets Act 2000 (Financial Promotion) Order 2005 or in
circumstances in which section 21 of FSMA does not apply to
the company; and
(b) it has complied with, and will comply with all
applicable provisions of FSMA with respect to anything done by
it in relation to the shares in, from or otherwise involving the
United Kingdom.
European Economic
Area
In relation to each Member State of the European Economic Area
which has implemented the Prospectus Directive (each, a Relevant
Member State), each underwriter has represented and agreed that
with effect from and including the date on which the Prospectus
Directive is implemented in that Relevant Member State (the
Relevant Implementation Date) it has not made and will not make
an offer of shares to the public in that Relevant Member State
prior to the publication of a prospectus in relation to the
shares which has been approved by the competent authority in
that Relevant Member State or, where appropriate, approved in
another Relevant Member State and notified to the competent
authority in that Relevant Member State, all in accordance with
the Prospectus Directive, except that it may, with effect from
and including the Relevant Implementation Date, make an offer of
shares to the public in that Relevant Member State at any time :
(a) to legal entities which are authorized or regulated to
operate in the financial markets or, if not so authorized or
regulated, whose corporate purpose is solely to invest in
securities;
(b) to any legal entity which has two or more of
(1) an average of at least 250 employees during the
last financial year; (2) a total balance sheet of more than
€43,000,000 and (3) an annual net turnover of more
than €50,000,000, as shown in its last annual or
consolidated accounts;
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(c) to fewer than 100 natural or legal persons (other than
qualified investors as defined in the Prospectus Directive)
subject to obtaining the prior consent of the representatives
for any such offer); or
(d) in any other circumstances which do not require the
publication by the company of a prospectus pursuant to
Article 3 of the Prospectus Directive.
For the purposes of this provision, the expression an
“offer of shares to the public” in relation to any
shares in any Relevant Member State means the communication in
any form and by any means of sufficient information on the terms
of the offer and the shares to be offered so as to enable an
investor to decide to purchase or subscribe the shares, as the
same may be varied in that Relevant Member State by any measure
implementing the Prospectus Directive in that Relevant Member
State and the expression Prospectus Directive means Directive
2003/71/EC and includes any relevant implementing measure in
each Relevant Member State.
The shares may not be offered or sold by means of any document
other than to persons whose ordinary business is to buy or sell
shares or debentures, whether as principal or agent, or in
circumstances which do not constitute an offer to the public
within the meaning of the Companies Ordinance (Cap. 32) of
Hong Kong, and no advertisement, invitation or document relating
to the shares may be issued, whether in Hong Kong or elsewhere,
which is directed at, or the contents of which are likely to be
accessed or read by, the public in Hong Kong (except if
permitted to do so under the securities laws of Hong Kong) other
than with respect to shares which are or are intended to be
disposed of only to person outside Hong Kong or only to
“professional investors” within the meaning of the
Securities and Futures Ordinance (Cap. 571) of Hong Kong
and any rules made thereunder.
This prospectus supplement has not been registered as a
prospectus with the Monetary Authority of Singapore.
Accordingly, this prospectus supplement and any other document
or material in connection with the offer or sale, or invitation
for subscription or purchase, of the shares may not be
circulated or distributed, nor may the shares be offered or
sold, or be made the subject of an invitation for subscription
or purchase, whether directly or indirectly, to persons in
Singapore other than (i) to an institutional investor under
Section 274 of the Securities and Futures Act,
Chapter 289 of Singapore (the “SFA”),
(ii) to a relevant person, or any person pursuant to
Section 275(1A), and in accordance with the conditions,
specified in Section 275 of the SFA or (iii) otherwise
pursuant to, and in accordance with the conditions of, any other
applicable provision of the SFA.
Where the shares are subscribed or purchased under
Section 275 by a relevant person which is: (a) a
corporation (which is not an accredited investor) the sole
business of which is to hold investments and the entire share
capital of which is owned by one or more individuals, each of
whom is an accredited investor; or (b) a trust (where the
trustee is not an accredited investor) whose sole purpose is to
hold investments and each beneficiary is an accredited investor,
shares, debentures and units of shares and debentures of that
corporation or the beneficiaries’ rights and interest in
that trust shall not be transferable for 6 months after
that corporation or that trust has acquired the shares under
Section 275 except: (1) to an institutional investor
under Section 274 of the SFA or to a relevant person, or
any person pursuant to Section 275(1A), and in accordance
with the conditions, specified in Section 275 of the SFA;
(2) where no consideration is given for the transfer; or
(3) by operation of law.
The securities have not been and will not be registered under
the Financial Instruments and Exchange Law of Japan (the
“Financial Instruments and Exchange Law”) and each
underwriter has agreed that it will not offer or sell any
securities, directly or indirectly, in Japan or to, or for the
benefit of, any resident of Japan (which term as used herein
means any person resident in Japan, including any corporation or
other entity organized under the laws of Japan), or to others
for re-offering or resale, directly or indirectly, in Japan or
to a resident of Japan, except pursuant to an exemption from the
registration requirements of, and otherwise in compliance with,
the Financial Instruments and Exchange Law and any other
applicable laws, regulations and ministerial guidelines of Japan.
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Because the shares being offered are shares of Greenhill, the
parent of Greenhill & Co., LLC, a FINRA member, the
offering will be made in compliance with the applicable
provisions of Rule 2720 of the Conduct Rules of the NASD.
No FINRA member firm participating in the offering may sell
shares to a discretionary account without the prior specific
written approval of the customer.
We estimate that our share of the total expenses of the
offering, excluding underwriting discounts and commissions
payable by the selling stockholders, will be approximately
$300,000.
Each of Greenhill and each of the selling stockholders has
agreed to indemnify the several underwriters against certain
liabilities, including liabilities under the Securities Act of
1933.
Certain of the underwriters and their respective affiliates
have, from time to time, performed, and may in the future
perform, various financial advisory and investment banking
services for us, for which they received or will receive
customary fees and expenses.
VALIDITY OF
COMMON STOCK
The validity of the shares of common stock offered hereby has
been passed upon for Greenhill & Co., Inc. by Davis
Polk & Wardwell LLP, New York, New York. The validity
of the shares of common stock offered hereby will be passed upon
for the underwriters by Sullivan & Cromwell LLP, New
York, New York. Sullivan & Cromwell LLP has performed
legal services for us in the past.
EXPERTS
The consolidated financial statements of Greenhill &
Co., Inc., incorporated by reference in Greenhill &
Co., Inc.’s Annual Report
(Form 10-K)
for the year ended December 31, 2008, and the effectiveness
of Greenhill & Co., Inc.’s internal control over
financial reporting as of December 31, 2008, have been
audited by Ernst & Young LLP, independent registered
public accounting firm, as set forth in their reports thereon
incorporated by reference therein, and incorporated herein by
reference. Such consolidated financial statements have been
incorporated herein by reference in reliance upon such reports
given on the authority of such firm as experts in accounting and
auditing.
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Table of Contents
PROSPECTUS
3,000,000 Shares
Greenhill & Co.,
Inc.
COMMON STOCK
Certain selling stockholders may offer and sell shares of our
common stock from time to time in amounts, at prices and on
terms that will be determined at the time of any such offering.
Each time any securities are offered pursuant to this
prospectus, we will provide a prospectus supplement and attach
it to this prospectus. The prospectus supplement will contain
more specific information about the offering, including the
names of any selling stockholders.
You should carefully read this prospectus and any supplement,
together with the documents we incorporate by reference, before
you invest in our common stock.
Our common stock is listed on the New York Stock Exchange under
the symbol “GHL”.
Investing in our common stock involves certain risks. See
“Risk Factors” beginning on page 6 of our annual
report on
Form 10-K
for the year ended December 31, 2008, which is incorporated
by reference herein.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved these
securities, or determined if this prospectus is truthful or
complete. Any representation to the contrary is a criminal
offense.
The date of this prospectus is July 29, 2009
You should rely only on the information contained in or
incorporated by reference in this prospectus. We have not
authorized anyone to provide you with different information. We
are not making an offer of these securities in any state where
the offer is not permitted. You should not assume that the
information contained in or incorporated by reference in this
prospectus is accurate as of any date other than the date on the
front of this prospectus. The terms “Greenhill”,
“we”, “us”, and “our” refer to
Greenhill & Co., Inc. and, unless the context
otherwise requires, its consolidated subsidiaries.
TABLE OF
CONTENTS
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| 9 | ||||
About this
Prospectus
This prospectus is part of a registration statement that we
filed with the Securities and Exchange Commission
(“SEC”) utilizing a “shelf” registration
process. Under this shelf process, we and certain of our
stockholders may sell the common stock described in this
prospectus in one or more offerings. This prospectus provides
you with a general description of the common stock. Each time we
or certain of our stockholders sell common stock, we will
provide a prospectus supplement that will contain specific
information about the terms of that offering. The prospectus
supplement may also add, update or change information contained
in this prospectus. You should read both this prospectus and any
prospectus supplement together with the additional information
described under the heading “Where You Can Find More
Information”.
Table of Contents
GREENHILL
Overview
Greenhill is an independent investment banking firm that
(i) provides financial advice on significant mergers,
acquisitions, restructurings and similar corporate finance
matters as well as fund placement services for private equity
and other financial sponsors and (ii) manages merchant
banking funds and similar vehicles and commits capital to those
funds and vehicles. We act for clients located throughout the
world from offices in New York, London, Frankfurt, Toronto,
Tokyo, Chicago, Dallas, Los Angeles and San Francisco and
will open an office in Houston shortly.
We were established in 1996 by Robert F. Greenhill, the former
President of Morgan Stanley and former Chairman and Chief
Executive of Smith Barney. Since its founding, Greenhill has
grown steadily, recruiting a number of managing directors from
major investment banks (as well as senior professionals from
other institutions), with a range of geographic, industry or
transaction specialties and different sets of corporate
management and other relationships. As part of this expansion,
we opened a London office in 1998, raised our first merchant
banking fund in 2000, opened a Frankfurt office later in 2000
and began offering financial restructuring advice in 2001. On
May 11, 2004, we converted from a limited liability company
to a corporation and completed an initial public offering of our
common stock. We opened our Dallas office and completed the
closing of our second merchant banking fund in 2005. We opened
our Toronto office and completed the final closing of our first
venture capital fund in 2006. In 2007, we completed the final
closing of our first European merchant banking fund. We
completed the initial public offering of our special purpose
acquisition company, GHL Acquisition Corp., in February 2008,
opened our San Francisco office in April 2008, launched our
Fund Placement Advisory Group in May 2008, opened our Tokyo
office in October 2008 and opened our Chicago office in December
2008. In the first half of 2009, we announced the formation of
our Financing Advisory & Restructuring Group in New
York and London, opened our Los Angeles office and will open a
Houston office shortly. As of June 30, 2009, we employed 69
managing directors and senior advisors globally, 26 of whom were
hired in the 18 months ending that date, essentially
doubling our managing director headcount in financial advisory.
We expect to seek to continue to add industry-focused senior
employees and to expand geographically.
Principal Sources
of Revenue
Our principal sources of revenue are financial advisory services
and merchant banking.
Financial
Advisory Revenue
Our financial advisory business consists of mergers and
acquisitions, financing advisory and restructuring, and fund
placement advisory. For all of our financial advisory services,
we draw on the extensive experience, corporate relationships and
industry expertise of our managing directors and senior advisors.
On mergers and acquisitions engagements, we provide a broad
range of advice to global clients in relation to domestic and
cross-border mergers, acquisitions, and similar corporate
finance matters and are generally involved at each stage of
these transactions, from initial structuring to final execution.
Our focus is on providing high-quality advice to senior
executive management and boards of directors of prominent large
and mid-cap companies in transactions that typically are of the
highest strategic and financial importance to those companies.
We advise clients on strategic matters, including acquisitions,
divestitures, defensive tactics, special committee assignments
and other important corporate events. We provide advice on
valuation, tactics, industry dynamics, structuring alternatives,
timing and pricing of transactions, and financing alternatives.
Where requested to do so, we may provide an opinion regarding
the fairness of a transaction.
In our financing advisory and restructuring practice, we advise
debtors, creditors and companies experiencing financial distress
as well as potential acquirors of distressed companies and
assets. We
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provide advice on valuation, restructuring alternatives, capital
structures, and sales or recapitalizations. We also assist those
clients who seek court-assisted reorganizations by developing
and seeking approval for plans of reorganization as well as the
implementation of such plans.
In our fund placement advisory practice we assist private equity
funds and other financial sponsors in raising capital from a
global set of institutional and other investors.
Financial advisory revenues accounted for 96%, 98% and 92% of
our revenues in the six months ended June 30, 2009 and in
fiscal years 2008 and 2007, respectively.
Non-U.S. clients
are a significant part of our business, generating 28%, 53% and
64% of our financial advisory revenues for the six months ended
June 30, 2009 and in fiscal year 2008 and 2007,
respectively. We generate revenues from our financial advisory
services by charging our clients fees consisting principally of
fees paid upon the commencement of an engagement, fees paid upon
the announcement of a transaction, fees paid upon the successful
conclusion of a transaction or closing of a fund and, in
connection principally with restructuring assignments, monthly
retainer fees.
Merchant Banking
and Other
Our merchant banking activities currently consist primarily of
management of and investment in Greenhill’s merchant
banking funds, Greenhill Capital Partners I (or “GCP
I”), Greenhill Capital Partners II (or “GCP
II”, and collectively with GCP I, “Greenhill
Capital Partners” or “GCP”), Greenhill SAV
Partners (or “GSAVP”) and Greenhill Capital Partners
Europe (or “GCP Europe”), which are families of
merchant banking funds that invest in portfolio companies.
Merchant banking funds are private investment funds raised from
contributions by qualified institutional investors and
financially sophisticated individuals. The funds generally make
investments in non-public companies, typically with a view
toward divesting within 3 to 5 years. We pursue merchant
banking and other investment activities in addition to our
financial advisory activities because we believe merchant
banking can generate attractive returns on the firm’s
capital, and because it allows us to further leverage our
managing directors’ industry knowledge and corporate
relationships. We believe we can pursue merchant banking
opportunities without creating conflicts with our advisory
clients by typically focusing on significantly smaller companies
than those with respect to which we seek to provide financial
advice. GCP typically makes controlling or influential minority
investments of $10 million to $75 million in companies
with valuations that are between $50 million and
$500 million at the time of investment. GCP has invested a
substantial portion of its capital in the energy, financial
services and telecommunications industries. GSAVP typically
makes smaller investments in early-growth-stage companies that
offer technology-enabled or business information services. Such
investments typically involve higher levels of risk and are more
speculative than our GCP investments. GCP Europe typically makes
controlling or influential minority investments of
£10 million to £30 million in companies with
valuations that are between £50 million and
£250 million at the time of investment.
Merchant banking and other revenue accounted for 4%, 2% and 8%
of our revenues in the six months ended June 30, 2009 and
in fiscal years 2008 and 2007, respectively. We generate
merchant banking revenue from (i) management fees paid by
the funds we manage, (ii) gains (or losses) on our
investments in the merchant banking funds and other principal
investment activities, and (iii) merchant banking profit
overrides. We charge management fees in GCP II, GSAVP and GCP
Europe to all investors except the firm. In GCP I, we
charge management fees to all outside investors who are not
employed or affiliated with us. We may also generate gains (or
losses) from our capital investment in our merchant banking
funds depending upon the performance of the funds. Our
investments in our merchant banking funds generate realized and
unrealized investment gains (or losses) based on our allocable
share of earnings generated by the funds. As the general partner
of our merchant banking funds we make investment decisions for
the funds and are entitled to receive an override on the profits
of the funds after certain performance hurdles are met.
We began our merchant banking activities in 2000 with the
establishment of GCP I, which had total committed capital
of $423 million. In 2005 we closed our second merchant
banking fund, GCP II,
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which had total committed capital of $875 million. The firm
has committed approximately 10%, or $88.5 million, to GCP
II and our managing directors and other employees have committed
an additional $136 million to that fund. In 2006 we
expanded our merchant banking activities with the closing of our
venture capital fund, GSAVP, which had total committed capital
of $101.5 million. The firm has committed
$10.9 million to GSAVP and our managing directors and other
employees have committed an additional $22.6 million to
that fund. In 2007, we closed our first European merchant
banking fund, GCP Europe, which had total committed capital of
approximately £191 million. The firm has committed
£25 million to GCP Europe and our managing directors
and other employees have committed an additional
£41.9 million.
In February 2008, GHL Acquisition Corp. (“GHLAC”), a
blank check company sponsored by the firm, completed its initial
public offering, selling 40,000,000 units for an aggregate
purchase price of $400 million. We originally invested
$8.0 million in GHLAC and owned approximately 17.3% of its
outstanding common stock (AMEX:GHQ) upon consummation of the
offering. In September 2008, GHLAC announced that it had agreed
to acquire Iridium Holdings, L.L.C. (“Iridium”), a
leading provider of voice and data mobile satellite services, at
an enterprise value of approximately $591 million, subject
to stockholder approval, various regulatory approvals and other
customary closing conditions. In October 2008, we invested
$22.9 million in a convertible subordinated note issued by
Iridium. During the second quarter of 2009, GHLAC reached an
agreement to reduce by 15% the consideration to be paid in its
planned acquisition of Iridium. In July 2009, GHLAC reached
agreement with certain warrant holders, including Greenhill, to
repurchase or restructure their GHLAC warrants upon closing of
its acquisition of Iridium. If the acquisition of Iridium is
completed upon the agreed terms and our investment in Iridium is
converted to GHLAC common shares, based on GHLAC’s current
capitalization we will own approximately 8.9 million common
shares, or 10.6% of the combined company’s common stock,
assuming exercise of all currently in-the-money warrants and
approval by all GHLAC shareholders of the acquisition. We would
also own 4.0 million out-of-the-money warrants of the
combined company. The acquisition of Iridium remains subject to
Federal Communications Commission approval as well as approval
by GHLAC shareholders.
Our principal executive offices are located at 300 Park Avenue,
23rd
Floor, New York, New York 10022, and our telephone
number is
(212) 389-1500.
We maintain a website at www.greenhill.com where general
information about us is available. We are not incorporating the
contents of the website into this prospectus.
WHERE YOU CAN
FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements
and other information with the SEC. You may read and copy any
document that we file at the Public Reference Room of the SEC at
100 F Street, N.E., Washington, D.C. 20549. You
may obtain information on the operation of the Public Reference
Room by calling the SEC at
1-800-SEC-0330.
In addition, the SEC maintains an Internet site at
http://www.sec.gov,
from which interested persons can electronically access our SEC
filings, including the registration statement and the exhibits
and schedules thereto.
The SEC allows us to “incorporate by reference” the
information we file with them, which means that we can disclose
important information to you by referring you to those
documents. The information incorporated by reference is an
important part of this prospectus, and information that we file
later with the SEC will automatically update and supersede this
information. We incorporate by reference the documents listed
below and all documents we file pursuant to Section 13(a),
13(c), 14 or 15 (d) of the Securities Exchange Act of 1934,
as amended (the “Exchange Act”), on or after the date
of this prospectus and prior to the termination of the offering
under this prospectus and any accompanying prospectus supplement
(other than in each case unless otherwise indicated,
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documents or information deemed to have been furnished and not
filed in accordance with SEC rules):
(a) Annual Report on
Form 10-K
for the year ended December 31, 2008;
(b) Quarterly Reports on
Form 10-Q
for the periods ended March 31, 2009 and June 30, 2009;
(c) Current Reports on
Form 8-K
filed on January 30, 2009, June 22, 2009,
July 23, 2009 and July 29, 2009 (including the
furnished information therein); and
(d) Registration Statement on
Form 8-A
dated April 20, 2004.
You may request a copy of these filings at no cost, by writing
or telephoning:
Investor
Relations
Greenhill & Co., Inc.
300 Park Avenue
23rd Floor
New York, New York 10022
Telephone: (212 ) 389-1800
E-mail Address: Investorrelations@greenhill.com
Greenhill & Co., Inc.
300 Park Avenue
23rd Floor
New York, New York 10022
Telephone: (212 ) 389-1800
E-mail Address: Investorrelations@greenhill.com
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SPECIAL
NOTE ON FORWARD-LOOKING STATEMENTS
This prospectus includes forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
In some cases, you can identify these statements by
forward-looking words such as “may”,
“might”, “will”, “should”,
“expect”, “plan”, “anticipate”,
“believe”, “estimate”, “predict”,
“potential” or “continue”, the negative of
these terms and other comparable terminology. These
forward-looking statements, which are subject to risks,
uncertainties and assumptions about us, may include projections
of our future financial performance, based on our growth
strategies and anticipated trends in our business. These
statements are only predictions based on our current
expectations and projections about future events. There are
important factors that could cause our actual results, level of
activity, performance or achievements to differ materially from
the results, level of activity, performance or achievements
expressed or implied by the forward-looking statements. In
particular, you should consider the numerous risks outlined
under “Risk Factors” in our Annual Report on
Form 10-K
for the year ended December 31, 2008 (the
“10-K”),
which is incorporated by reference into this prospectus.
These risks are not exhaustive. Other sections of this
prospectus, any prospectus supplement and the documents
incorporated by reference may include additional factors which
could adversely impact our business and financial performance.
Moreover, we operate in a very competitive and rapidly changing
environment. New risk factors emerge from time to time and it is
not possible for our management to predict all risk factors, nor
can we assess the impact of all factors on our business or the
extent to which any factor, or combination of factors, may cause
actual results to differ materially from those contained in any
forward-looking statements.
Although we believe the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee
future results, level of activity, performance or achievements.
Moreover, neither we nor any other person assumes responsibility
for the accuracy or completeness of any of these forward-looking
statements. You should not rely upon forward-looking statements
as predictions of future events. We are under no duty to update
any of these forward-looking statements after the date of this
filing to conform our prior statements to actual results or
revised expectations.
Forward-looking statements include, but are not limited to, the
following:
| • | the statements about our policy that our total compensation and benefits, including that payable to our managing directors and senior advisors, will not exceed 50% of total revenues each year (although we retain the ability to change this policy in the future) in the 10-K under “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Compensation and Benefits”; | |
| • | the statement about our expectation that revenues from our financial advisory business will continue to account for the majority of our revenues in the near to medium-term in the 10-K under “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Overview”; | |
| • | the statement about our expectations that we expect to expand our merchant banking management business and related activities over time in the 10-K under “Overview — Merchant Banking and Other”; | |
| • | the statements about the expected opening of our Houston office and our expansion plans and the completion of the acquisition of Iridium in this prospectus under “Greenhill — Overview” and “Greenhill — Merchant Banking and Other”; | |
| • | the statement about new managing directors adding incrementally to our revenue and income growth potential in the 10-K under “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Overview”; |
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| • | the statement about the bankruptcy or merger of our larger competitors will create opportunities for us to attract new clients and provide us with excellent recruiting opportunities to further expand our industry expertise and geographic reach in the 10-K under “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Business Environment”; | |
| • | the statement that weak economic and financial conditions should provide attractive opportunities to invest unspent merchant banking capital in the 10-K under “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Business Environment”; | |
| • | the statements about our expected annual fees from our merchant banking funds in 2009 and thereafter in the 10-K under “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Merchant Banking and Other Revenues”; | |
| • | the statement that GHLAC’s consummation of its transaction with Iridium could provide a significant source of additional merchant banking revenue after completion in the 10-K under “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Merchant Banking and Other Revenues”; | |
| • | the statement about our expectation that non-compensation costs, particularly occupancy, travel and information services costs, will increase as we grow our business and make strategic investments in the 10-K under “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Non-Compensation Expense”; and | |
| • | the discussion of our ability to meet liquidity needs in the 10-K under “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources”. |
DESCRIPTION OF
CAPITAL STOCK
General
Matters
The following description of our common stock and preferred
stock and the relevant provisions of our amended and restated
certificate of incorporation and amended and restated bylaws are
summaries thereof and are qualified by reference to our amended
and restated certificate of incorporation and amended and
restated bylaws, copies of which have been filed with the
Securities and Exchange Commission as exhibits to the
10-K and our
current Report on
Form 8-K
filed on January 30, 2009, respectively, which exhibits are
incorporated by reference into this prospectus.
Our authorized capital stock currently consists of
100,000,000 shares of common stock, $0.01 par value,
and 10,000,000 shares of preferred stock, $0.01 par
value.
Common
Stock
As of July 24, 2009, there were 28,156,741 shares of
common stock outstanding.
The holders of common stock are entitled to one vote per share
on all matters to be voted upon by the stockholders and do not
have cumulative voting rights. Subject to preferences that may
be applicable to any outstanding preferred stock, the holders of
common stock are entitled to receive ratably such dividends, if
any, as may be declared from time to time by the Board of
Directors out of funds legally available therefor. See
“Dividend Policy”. In the event of liquidation,
dissolution or winding up of Greenhill, the holders of common
stock are entitled to share ratably in all assets remaining
after payment of liabilities, subject to prior distribution
rights of preferred stock, if any, then outstanding. The common
stock has no preemptive or conversion rights or other
subscription rights. There are no redemption or sinking fund
provisions applicable to the common stock. All outstanding
shares of common stock are fully paid and non-assessable, and
the shares of common stock to be issued upon
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completion of this offering will be fully paid and
non-assessable. As of July 20, 2009, there were 14 holders
of record of our common stock.
Preferred
Stock
The Board of Directors has the authority to issue preferred
stock in one or more classes or series and to fix the
designations, powers, preferences and rights, and the
qualifications, limitations or restrictions thereof including
dividend rights, dividend rates, conversion rights, voting
rights, terms of redemption, redemption prices, liquidation
preferences and the number of shares constituting any class or
series, without further vote or action by the shareholders. The
issuance of preferred stock may have the effect of delaying,
deferring or preventing a change in control of Greenhill without
further action by the shareholders and may adversely affect the
voting and other rights of the holders of common stock. At
present, Greenhill has no plans to issue any of the preferred
stock.
Voting
The affirmative vote of a majority of the shares of our capital
stock present, in person or by written proxy, at a meeting of
stockholders and entitled to vote on the subject matter will be
the act of the stockholders.
Our amended and restated certificate of incorporation may be
amended in any manner provided by the Delaware General
Corporation Law. The Board of Directors has the power to adopt,
amend or repeal our amended and restated bylaws.
Action by Written
Consent
Any action required or permitted to be taken at any annual or
special meeting of stockholders may be taken without a meeting,
without prior notice and without a vote, if the consent to such
action in writing is signed by the holders of outstanding stock
having not less than the minimum number of votes that would be
necessary to authorize or take such action at a meeting at which
all shares entitled to vote thereon were present and voted.
Anti-Takeover
Effects of Delaware Law
Greenhill is subject to the “business combination”
provisions of Section 203 of the Delaware General
Corporation Law. In general, such provisions prohibit a publicly
held Delaware corporation from engaging in various
“business combination” transactions with any
interested stockholder for a period of three years after the
date of the transaction in which the person became an interested
stockholder, unless:
| • | the transaction is approved by the Board of Directors prior to the date the interested stockholder obtained such status; | |
| • | upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced; or | |
| • | on or subsequent to such date, the business combination is approved by the Board of Directors and authorized at an annual or special meeting of stockholders by the affirmative vote of at least 662/3% of the outstanding voting stock which is not owned by the interested stockholder. |
A “business combination” is defined to include
mergers, asset sales and other transactions resulting in
financial benefit to a stockholder. In general, an
“interested stockholder” is a person who, together
with affiliates and associates, owns (or within three years, did
own) 15% or more of a corporation’s voting stock. The
statute could prohibit or delay mergers or other takeover or
change in control attempts with respect to Greenhill and,
accordingly, may discourage attempts to acquire
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Greenhill even though such a transaction may offer
Greenhill’s stockholders the opportunity to sell their
stock at a price above the prevailing market price.
Limitation of
Liability and Indemnification Matters
Our amended and restated certificate of incorporation provides
that a director of Greenhill will not be liable to Greenhill or
its shareholders for monetary damages for breach of fiduciary
duty as a director, except in certain cases where liability is
mandated by the Delaware General Corporation Law. Our amended
and restated certificate of incorporation also provides for
indemnification, to the fullest extent permitted by law, by
Greenhill of any person made or threatened to be made a party
to, or who is involved in, any threatened, pending or completed
action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that such
person is or was a director or officer of Greenhill, or at the
request of Greenhill, serves or served as a director or officer
of any other enterprise, against all expenses, liabilities,
losses and claims actually incurred or suffered by such person
in connection with the action, suit or proceeding. Our amended
and restated certificate of incorporation also provides that, to
the extent authorized from time to time by our Board of
Directors, Greenhill may provide indemnification to any one or
more employees and other agents of Greenhill to the extent and
effect determined by the Board of Directors to be appropriate
and authorized by the Delaware General Corporation Law. Our
amended and restated certificate of incorporation also permits
us to purchase and maintain insurance for the foregoing and we
expect to maintain such insurance.
Listing
Our common stock is listed on the New York Stock Exchange under
the symbol “GHL”.
Transfer Agent
and Registrar
The transfer agent and registrar for our common stock is
American Stock Transfer & Trust Company.
USE OF
PROCEEDS
Unless otherwise specified in the applicable prospectus
supplement, the selling stockholders will receive all of the net
proceeds from the sale of the shares of common stock offered by
this prospectus. We will not receive any proceeds from the
offering contemplated by this prospectus.
VALIDITY OF
SECURITIES
The validity of the common stock in respect of which this
prospectus is being delivered will be passed on for us by Davis
Polk & Wardwell LLP.
SELLING
STOCKHOLDERS
Selling stockholders will use this prospectus in connection with
resales of shares. The applicable prospectus supplement or
post-effective amendment will identify the selling stockholders,
the terms of the securities and the transaction in which the
selling stockholders acquired the shares. Selling stockholders
may be deemed to be underwriters in connection with the shares
they resell and any profits on the sales may be deemed to be
underwriting discounts and commission under the Securities Act
of 1933, as amended. Unless otherwise specified in the
applicable prospectus supplement, we will not receive any
proceeds from the sale of shares by selling stockholders.
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PLAN OF
DISTRIBUTION
Selling stockholders may sell the offered shares through agents,
underwriters or dealers, or directly to one or more purchasers,
or through a combination of these methods of sale. We will
identify the specific plan of distribution, including any
agents, underwriters, dealers or direct purchasers, and any
compensation paid in connection therewith, in the applicable
prospectus supplement.
EXPERTS
The consolidated financial statements of Greenhill &
Co., Inc., incorporated by reference in Greenhill &
Co., Inc.’s Annual Report
(Form 10-K)
for the year ended December 31, 2008, and the effectiveness
of Greenhill & Co., Inc.’s internal control over
financial reporting as of December 31, 2008, have been
audited by Ernst & Young LLP, independent registered
public accounting firm, as set forth in their reports thereon
incorporated by reference therein, and incorporated herein by
reference. Such consolidated financial statements have been
incorporated herein by reference in reliance upon such reports
given on the authority of such firm as experts in accounting and
auditing.
9
You should rely only on the information contained in or
incorporated by reference in this prospectus supplement and the
accompanying prospectus. We have not, and the underwriters have
not, authorized anyone to provide you with different or
inconsistent information. We are not, and the underwriters are
not, making an offer of these securities in any state where the
offer is not permitted. You should not assume that the
information contained in this prospectus supplement, the
accompanying prospectus and the documents incorporated by
reference is accurate as of any date other than their respective
dates. Our business, financial condition, results of operations
and prospects may have changed since these dates.
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3,000,000 Shares
Greenhill & Co.,
Inc.
Common Stock
Goldman, Sachs &
Co.
William Blair & Company
JMP Securities
Keefe, Bruyette & Woods
Sandler O’Neill + Partners, L.P.