Thoughts on M&A consulting?
As someone with little experience in consulting so far, I am curious where management consultants come into play in the standard M&A process (besides the DD). Does anyone have a specific example of tasks?
DD, including the strategic rational for the acquisition, and post-merger integration (more management consulting rather than strategy houses) are the typical elements of a deal where a consulting firm may step in.
Sizing markets and adjacencies, assessing competition, business plan analysis etc are typical elements of DDs, both on the vendor and on the buyer side.
DDs are generally highly standardised
Thanks - so I assume they mainly work on the initial decision to engage in M&A and afterwards on the PMI/carve-out but do they ever directly collaborate with bankers on tasks?
Yes, we do occasionally have to deal with that, particularly on the larger deals and when working sell-side. But we have different task, hardly ever direct collaboration.
We do the thinking, the bankers do their excel sheets :)
Yeah I’m sure you do a lot of thinking while your Engagement Manager bends you over
It happens in the background but you just don't get to see it
Similarly, not to burst your bubble, most of the thinking is heavily influenced by your client but you won't see that either. Do you really believe after 3 weeks of work you understand a business better than the Execs who have been there for decades?
God I can tell that you didn't post this in a jocular fashion either...self awareness at a premium these days
I think some Management Consultants do try to go so far as identify acquisition targets as part of the diligence work but it is mainly from a strategy / synergy point of view.
The hours of consultants that do M&A work is consistently high. So you should keep this in mind as well.
total compensation to work load ratio of M&A consulting is not worth it in the end when your peers doing other "strategy" work make as much as you but work significantly less.
I work in M&A/PE consulting for a boutique shop. We often compete against BCG and McKinsey for larger engagements, though we have the ability to be more flexible in our staffing model and go downstream (e.g. work with smaller companies & PE Firms) on select engagements.
You mentioned DD work. We definitely do a bunch of buy-side (definitely commoditized, though every firm has something that is slightly differentiated) & sell-side (larger, more differentiated, more biased lol) DD's. This can include commercial, product, operational, and IT/Technology (quickly turning into one of the most important workstreams) DD. We don't do QoE, thank god.
Outside of Due Diligence, I can think of several engagements my team has worked on over the last six months:
Thanks! I guess with an M&A background, I am not that familiar with the consulting abbreviations haha. What do you mean by QoE?
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