Hiring a bank for round 2 of process
I work in corp dev of a strategic and am fairly new (only 2 yrs in). Typically I have done modeling and have never entred round 2 of a M&A process. We are entering one now and my manager told me we'd be hiring an investment bank to help us. I dont want to sound dumb and ask my manager , so asking here. how are modeling / valuation / due diligence work streams split up with an investment bank? i understand my team is the one ultimately responsible for signing off, but more wondering about how day-to-day responsibilities are divided up
I hate to give an answer like "it depends", but it really does.
I've worked on processes where we (the bank) write entire Board Decks and sections of IC papers and others where we do little to nothing except basic inputs. We handle the model in some situations and hardly touch it in others. With "due diligence", this can mean 1,000 different things, but obviously you can't just ask the bank to look in the VDR and ask if they're comfortable with it, but they can certainly help you with summaries or analysis, and help coordinate the due diligence advisors, submit and organise Q&A (and ideally ask sensible follow-up questions), and interactions with the sellside.
Moreover, particularly with corporates, it's not just that I've worked on situations where we do a lot and where we do a little, but also the reason driving it is different. Some highly sophisticated clients just prefer to keep things lean / mostly senior internally and use banks very efficiently for grunt-work and intel. Some unsophisticated clients need the bank to hand-hold them and so we end up being very hands-on (sometimes a little too hands-on where the client ask us questions where my reaction (in my mind only) is "really?" or they tell a little too much information).
So, my practical advice is to ask your senior if they have any preferences or standard modus operandi with IBs, and policies on what you can and can't do (are / are not comfortable with sharing). Maybe (remember I'm a random guy on the internet so that's your source) use some variant of the above and explain you've had a broad range of experiences and just want to check how things are done here.
Thanks, v, helpful, we are thinking of a top BB (jpm, gs, MS, lazard). So I doubt we would want them for grunk work?There are former bankers and PE folks in my team
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