A&D vs Coverage in Energy
Hello fellow monkeys,
Just looking to do some company research and can't seem to find an explanation of what Acquisitions and Divestitures really means. Have an informational interview with an associate in one of the banks that has a strong A&D practice, but I really can't figure out what it means to be in the A&D group rather than the energy coverage group. Does anybody in energy know specifically what A&D refers to?
E&P companies are always trying to optimize their portfolios by buying and selling properties to meet business objectives. Therefore, they often participate in A&D's, which involve oil and gas assets or packages of assets. Where as coverage groups typically perform the more traditional investment banking duties.
It is essentially an M&A team focusing on upstream O&G assets (property leases, concessions, production sharing contracts, etc.) rather than traditional corporate-level deals. While the process is many ways similar to normal M&A transaction (create info memo, run data room, etc etc) the teams will usually have people with technical backgrounds (reservoir engineers) to deal with the specific nature of these assets.
A coverage group for a specific industry will work with respective product groups (such as A&D in this case, capital markets, commodity hedging, etc) to offer wide variety of products to their clients.
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