Hey All,
I just wanted to see if anyone could give me some ideas about exit opps from top Natural Resources Groups? In this case think BB.
I am curious if exit Opps are primarily in industry specific funds or if you still see recruitment for general buyout practices at Megafunds? Thanks.
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Barclays?
The answer really depends on a variety of factors, namely location (NY vs Houston), type and breadth of deal experience, and skills gained.
In one extreme, you might work in Houston exclusively on upstream exploration and production companies, in which case, exiting to a generalist fund in NYC would be quite difficult. Although, the door is opened to a variety of specialized energy PE firms or hedge funds. One the other side, you might work deals ranging from infrastructure to Oil & Gas to mining, which would position you for a far wider range of opportunities.
Keep in mind that all of the Megafunds have natural resource groups, and its not uncommon for certain people to move to those teams at KKR, Carlyle, etc.
Infra funds are another common exit route for NatRes
Anyone have any information on these natural resource groups on the buyside?
And how would things change if my group was in NYC? Would deal most heavily with M&A.
This is correct. And most of the megafunds have infrastructure funds as well.
Houston is almost exclusively Oil & Gas, which isn't what I think of when I hear Natural Resources. Most NatRes groups are in NY and cover non-energy resource companies like metals and mining. If you're working at a top group in NY, you'll have plenty of exits into PE/HF if that's what you want. It's still banking.
FIG, Energy and RE are about the only industry verticals that tend to be "sticky" out of your analyst stint.
First Reserve, Pala, Pallinghurst, Resource Capital Funds...there are plenty more but these are just the few I can think of off the top of my head
These are just the more natural resource-focused shops. I've seen plenty of people out of NatRes groups place into the traditional buyout groups at MFs and top MM funds.
Yes, of course - was directed at the post above yours.
And yes, I've seen NatRes guys exit into traditional PEs - I think the key to making that kind of move if you're in NatRes is to demonstrate an interest in other industries (and finance in general), and prove you can be versatile. One of the common arguments against is that a lot of NatRes analysts won't have that much LBO experience (just not as common vs other industries) - personally I think that's crap, since NatRes is more technical than something like C&R, and LBOs are really not that complicated (both technically and in terms of transaction process / dynamics).
Agree with this 100%. As someone who has worked on both NatRes and more "traditional" (consumer / services) deals, I learned a great deal more on the NatRes transactions. An LBO of a chemicals company is fairly straightforward Revenue - COGS - SG&A = EBITDA * 8 = Deal Price. Many NatRes transactions involve JVs, governance and off-take agreements, uncommon transaction structures, and more nuanced valuation techniques. If you can model in NatRes, you should be able to knock out a traditional LBO with no issues. And if you work in a top group, you'll get plenty of looks from both traditional buyout funds and NatRes/Energy/Infrastructure-focused funds.
agree with all of this
What are the top nat res groups?
excellent post as usual SouthSider
Depends on your definition of "top". Deal flow and buyside placement don't always go hand-in-hand.
More interested in buyside placement, but also curious about deal flow.
Barclays, DB and JPM have strong placement and deal flow as far as BBs go. Most of the elite M&A boutiques have a presence on NatRes (though not necessarily a 'NatRes' group), and placement is obviously excellent as well.
Appreciate the response! How about the nat res groups at GS and MS?
I mean, what do you think?
To be honest I'm not sure what to think. I know GS and MS generally do well in terms of deal flow and buyside placement, but was wondering in particular how the nat res groups at those firms are relative to other nat res groups across the Street and other groups within their own firm because I have an interest in the industry.
GS and MS tend to place well across the board, though if you're legitimately interested in staying NatRes, I think going into one of the other groups I mentioned.
I don't know if you're talking about NYC but the Houston groups of some of those are definitely not top
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