Looking for M&A advisory
Hi,
I am sourcing for services to help our company with acquisitions. We may as well need structuring/tax advice as advice when it comes to screening potential targets in the region (Asia). What do you think is best a Big 4 audit firm (they do offer these services), or an investment bank? And why?
I do think investment banks are necessary for certain things, like IPO's, but in this case maybe we can do without, and not pay the expensive fees. Any comments are much appreciated.
It does depends on how much you want/can spend, how are you going to finance the transaction, where the targets you are considering and the size of the companies.
If the size of the acquisitions do not justify spending a >€500K-€1mln in fee, I will take into account Big 4 companies. Also note that for cross-border transactions, IB usually work better since there is more interaction among offices than in a big 4 (international network but not a unique company).
Another thing you have to keep in mind is how you want fo finance the transaction, if you are going to issue new shares or debt, using a large bank for this, you may be able to negotiate with the same bank a decent fee also for the advisory part.
Finally, there is some sinergies with regards to the tax & legal part but I cannot quantify it.
Hi Thank you for your reply! The targets could be in the region, so in different countries, the size of the companies would be most likely from very small, few million, to medium-sized 50-100 million. Is 500k-1mln the minimum, or does it always tend to stay in that range? I think your point on the interaction is very useful. Please share your ideas!
The minimum... it depends on the size of the transaction, complexity, previous relationship with the clients, it other products are involved (debt, equity, etc.).
The most important thing to consider is how relevant the experience is of the people who are actually really going to be working on the deal. All of the big 4 along with all of the banks are going to be able to produce pages and pages of creds from the larger, global team. You need to drill down and figure out the experience of the individual director, associates and analysts who would actually work with you.
M&A is pretty commoditized in that all of the firms can do it, from a functional perspective, but you should find someone who has actually done deals in your specific industry, and that are similar to your specific situation. If you are in the container shipping industry, you should go out and find a team that has container shipping experience. If you are a life insurance company, go out and find a team that has life insurance experience.
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