Bloomberg News reports that members of Goldman’s (GS) New York Principal Strategies team are in talks with several big-name firms, including KKR, Perella Weinberg and BlackRock Inc. (BLK), to possibly join one of them.
Bob Howard, who heads the Goldman group in the U.S., is said to be leading the discussions. The talks are in early stages and may fall apart before a deal is reached, the report said.
It is not surprising that big firms would bid for the services of Goldman’s proprietary traders, with new regulations forcing the firm’s hand, said one former Goldman managing director.
Reuters: “How many of those guys want to hire a part of the old Goldman dream…If they don’t get a deal done quickly, this asset will decay to zero. They are not stupid.
“If I had a private equity fund, I would no doubt be trying to buy into this.”
Goldman is disbanding its prop-trading desk business, one of the groups that makes speculative investments with the firm’s own money, to comply with new U.S. rules aimed at curbing risk.