By Ross Kelly 

U.S. investment bank Houlihan Lokey said Tuesday it has opened an office in Australia, hoping to fill a gap left by rivals that are slimming their operations Down Under as the local economy slows.

In its first major investment in Asia in four years, the Los Angeles-based firm--which typically advises on merger and acquisitions deals under US$5 billion--said it hired three senior staffers from CIMB Group Holdings Bhd. to jointly head up the operation, located in Sydney.

They include Nicholas Rowe and Oscar Ludwigson, CIMB's former Australian country chief and head of investment banking, respectively. Also joining is former CIMB senior banker David Tozer.

The office will have nine professional staffers including the three heads.

Its launch comes as other overseas-based investment banks depart Australia, where a decadelong economic boom fueled by high commodity prices is fading as demand from China cools. Royal Bank of Scotland International--the former international division of Lloyds Banking Group PLC--and Royal Bank of Scotland Group PLC have also sold their Australian business units in recent years.

"The economic malaise in Australia has certainly dampened the pull factor, but there's still push factors that are driving companies in places like the U.S. to look abroad," Mr. Ludwigson said in an interview. Lures include a rapid decline in the value of the Australian dollar, he said, which makes targets in Australia cheaper to buy. There is also a large amount of capital washing around that is looking for a home, while Houlihan's restructuring business provides some diversification in the market, he said.

"The market's slowing down here a bit, but at the same time there's some places where people are seeing value," said Mr. Rowe, who pointed to the recent takeover bid for engineering company Bradken Ltd. by private-equity firms as evidence that deals are still being pursued. Bain Capital LLC and Australia's Pacific Equity Partners have offered to buy the company for close to US$800 million.

Houlihan will be hoping to emulate the success of U.S. rival Moelis & Co., which opened an Australian office in 2009 after hiring bankers from firms including UBS AG and J.P. Morgan Chase & Co. Since then, Moelis's Australian team has successfully positioned itself as an independent adviser on deals from power-plant restructurings to sales of forestry assets.

Houlihan already has experience working on Australian deals, including the 3 billion Australian dollar (US$2.38 billion) restructuring of mall owner and operator Centro Properties Group.

Write to Ross Kelly at ross.kelly@wsj.com

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