November 18, 2019
Google has used Lazard on every takeover where it brought in an outside adviser since 2011, covering roughly $22 billion of transactions. The run stretches from the $9.8 billion Motorola Mobility deal in 2011 to the $2.1 billion Fitbit acquisition. For smaller transactions, Google generally relies on its in-house banking staff. Lazard also receives a retainer of more than $200,000 a month for its services, according to people familiar with the arrangement. That is not just a banking footnote; it is a reminder that in M&A, trust can become an asset as real as any fee pool.
The relationship is striking because Lazard has had a difficult stretch in advisory. Its share of global M&A by deal value stood at 4.3%, the firm’s lowest level since 2001, and it had fallen behind Evercore. Several prominent bankers had left, including Matthieu Pigasse and Antonio Weiss, and a few offices had closed. Google-related work may have brought Lazard only about $70 million in fees since 2011, while Lazard posted $304 million of financial advisory revenue in one quarter alone. The prestige is therefore doing work that the raw economics cannot fully capture.
The origin of the relationship appears to have been personal. Vernon Jordan, a senior managing director at Lazard and longtime power broker, helped open the door. His connection to Google came through David Drummond, who joined Google in 2002 and became vice president of corporate development. Jordan had called Drummond a good friend while honoring him at a social justice gala. This is the old line of banking at its purest: relationships first, mandate second.
Lazard’s role for Google has also gone beyond traditional sell-side or buy-side execution. It often acts like a consultant, researching industries and exploring potential acquisition targets. A former Lazard employee described the work as doing “science experiments” for Google. Those studies can later become formal M&A assignments, or Lazard can enter late in negotiations after Google employees have handled the earlier talks. For interview preparation, this is the nuance worth remembering: an adviser can win because it understands the client’s strategic map before a deal is even live.
The Fitbit deal shows how that advisory model can work. Lazard initially prepared a study on the smartwatch market, which helped lay the groundwork for Google’s purchase of certain Fossil Group technology. That then led to Lazard being hired for the Fitbit acquisition. Google did not need the full financing machine of a bulge bracket bank because it had the resources to pay for deals itself. In that context, a focused M&A adviser with discretion and institutional memory made practical sense.
Confidentiality appears central to the relationship. Google trusted Lazard to keep possible takeovers quiet, and some Lazard bankers were viewed almost as if they were embedded inside corporate development. Paul Haigney and John Gnuse handled the day-to-day relationship, with Haigney described by people who knew him as an old-school banker who avoided gossiping with the press. In the Fitbit announcement, Lazard’s role was so low profile that the release named Fitbit’s adviser, Qatalyst, but omitted Lazard. The lesson is simple: sometimes the best banker in the room is the one whose name never needs to appear.
There are limits to the relationship. Google’s acquisition pace could slow as federal, state and Congressional antitrust scrutiny increases. Lazard’s broader advisory business still depends on more than one marquee technology client. But for a firm trying to defend its place in elite M&A, serving as Google’s quiet deal whisperer is powerful evidence of relevance. Banking is often sold as modeling, valuation and process, but this relationship shows that discretion, judgment and personal confidence can decide who gets the call.