Restructuring vs. M&A
I have always been interested in restructuring but ended up signing with a top M&A group for next summer. I really loved my restructuring class and could see myself going into it for full time. How feasible is it to move from M&A to RX? I know its early and a lot could still change that'd make me want to stay in M&A, just curious if anyone has any experience they'd be willing to share.
Hi, can I ask you your background? are you going to start at a BB?
An EB
Are you going to be an analyst or associate? And does the EB where you're going to work do M&A and Rx? If analyst, it won't be that hard to move to restructuring. M&A is pretty quantitative, and if you're doing buyside work you'll get good exposure to complex balance sheets and cap structures.
Summer Analyst that will only be doing M&A
Assuming you're PJT/EVR then, you should be fine. I actually talked to someone pretty senior about this (interested in distressed/SSG in the future) and she was very adamant about focusing on LevFin/FSG/M&A straight out of college because it's much easier to move into RX down the line than out of it
M&A will afford you more exit optionality, including distressed credit down the road if that's your cup of tea.
I could see myself doing distressed PE or credit in the future so glad to know that's achievable from M&A as well. Thanks!
yes it is.. I interviewed for a MM Special Situation PE Fund in London and a lot of guys were from M&A at BBs or EBs (and some from Consulting, because the fund does Op. Restructuring)
You could always switch to another EB that does both M&A and Restructuring, and then later pivot towards just doing their Restructuring work.
I think ideally you would want to work as a generalist in both M&A and restructuring in your analyst years and have the options to choose later on, in terms of buyside and sellside placements.
My friends who switched from M&A to restructuring usually take a 1.5-2 years back since they don't have intimate understanding of the process yet to run on your own without being watched over.
Restructuring vs M&A skillset (Originally Posted: 06/11/2008)
If you end up working at a firm where the Restructuring and M&A teams are both very highly thought of, which of these two areas will give you a broader range of opportunities further down the line?
It seems that you can move from M&A to PE or a HF or a Corporate etc. but is Restructuring too narrowly focused in terms of the skillset you acquire to exit to anything other than something like a distressed debt HF?
M&A exit opps are generally PE shops or else onto a corporation. If you are very good you may get into a HF. On the other side with a restructuring background you can move onto Distressed Hedge Funds, PE shops, corporations and even the healthy side - M&A. The reason I say M&A is also a possibility is because the skillset of a restructuring banker includes all of the technical skills of an M&A banker + more.
this
thx, will bear this in mind :)
Restructuring or M&A (Originally Posted: 11/23/2016)
Simple question - assuming you got offers to top shops in both, which would you choose: Restructuring or M&A?
I would choose m&a since I don't like distressed
I would choose Restructuring. But as you can see it is up to your preference.
Restructuring. You do both financial restructuring and distressed M&A. Way cooler.
I would choose M&A, just to balance out this thread
Take Your Pick: Associate in M&A or 3rd Year Analyst Restructuring (Originally Posted: 12/23/2011)
Hey guys,
I have seen a lot of very helpful responses on this site, and I'm hoping to have the same experience. I do not have a traditional banking professional background (3+ years in corporate finance positions at financial advisory firms), but I have fortunately been presented with 2 great opportunities through some active job hunting:
-associate in the M&A group at a top MM bank (think Houlihan Lokey or Jefferies); and -3rd year analyst in the restructuring group at a well known MM bank (think William Blair or Raymond James)
What are your thoughts between these two opportunities? I'm factoring out the hours since both opportunities are going to consist of banking hours. Any feedback or thoughts would be greatly appreciated.
Thanks in advance
I'm not qualified to answer, but you might want to specify your longer term goals are to help other people advise you on the best path.
To be honest, I'd probably be more inclined to taking the M&A Associate role, if only becuase at that point you're already an associate. With the other position, how open are they to promoting you in a year? You don't want to have to do another job search in a year.
Well do you want to go into Restructuring ? The position shouldn't really matter it should be more what your interests are ========>M&A or ==========>Restructuring
Or did you mean to phrase the question in a way that would give you a Pro/Con list of both career paths?
You have to take into account your hopes and dreams in the future. If you want to make a jump to PE, might be better to get in at an analyst role, especially if the group is a well known or respected restructuring group. Restructuring is good right now and your modeling/technical knowledge/experience will be better than with an M&A group since you may have to put together things from scratch. I don't think you can go wrong here, but my personal opinion is go restructuring unless you want to be in IB long term.
You'll likely be expected to put things together from scratch in both roles that's kind of a moot point.
Thanks for the feedback so far. In terms of my long term goals, it would be to exit into a MM PE shop within the next 2-3 years or work in a corporate development role. I think both restructuring and M&A would provide some very solid skills and deal experience which could translate directly into those exit options.
@TheKing, the latter option mentioned that they are open to the idea of promotion after 1 year of serving as a 3rd year analyst.
@ProspectiveMonkey, I have more experience in restructuring but I am interested in M&A, which I view as a more versatile skill set. However the restructuring group also has its fair share of distressed M&A deals. I'm mainly looking for feed back as to which career path would best set me up for my intended exit options.
Thanks again
I'm with TheKing on this. You're basically getting a 'promotion' with the Associate role.
First, congrats on the offers in a tough market. I have to agree with happy and TheKing as well and suggest the associate role. Being "open to the idea of promotion" is not the same as already having it no matter how you slice it.
I would agree with the viewpoint that the associate opportunity should/can be viewed as getting a promotion. One risk I have identified with this, however, is that coming in as an associate may limit my exit opportunities into PE because I could be considered too senior. Would you all agree with this? Adding to this point, is there a risk that coming in as an associate may be viewed as I want to stay in Ibanking for the long term?
Actually I think you're really fortunate to get the associate level from 3 yrs of corporate finance without taking a discount, which is great. Some may say it's better to stay as an analyst for PE recruiting, but I think for this case (where you'll be looking at MM PE, if PE is something you want to do down the road), it won't matter. Because MM PE is less structured and less picky about taking analysts than associates. Given that, and assuming you're not particularly interested in restructuring vs. M&A, I would take the associate position.
Keep in mind that while the shop said they're open to promoting to Associate after 1 year, the 3rd year analyst to associate promotion may require more than 1 year for a firm to assess someone's performance. If I were you, I would take the associate 1 position over analyst 3. You'll be doing more or less the same thing, except with analyst 3, you'll have to really outperform right off the bat to be considered for promotion given the short amount of time. Whereas with Associate 1, it's almost like how newly minted MBAs join banks as associates - they are given some leeway and time to ramp up the learning curve. Plus a bigger base and bonus.
Thanks again for all the help. Kanon, you made some great points - I'm most likely going to go w/ the associate opportunity.
Restructuring vs. M&A summer (Originally Posted: 03/30/2011)
I'm fortunate enough to have the chance to work in either a top restructuring group or a top M&A group this summer. I'm interested in distressed investing, but am not sure that I would want to pursue it as a career. Considering the recovery in the economy, should I just go ahead and try to catch the M&A wave and do that full time also? Or will restructuring have decent enough deal flow that I'll still have good options come full time recruiting in case I don't enjoy restructuring? I'm worried about the opportunity cost of missing out on the M&A boom.
Would probably take M&A; assuming you're at LAZ / EVR / GHL, by the sound of it. M&A is more transferable to other groups and restructuring, although very interesting and technical, can pigeonhole somewhat. Even though you're interested in distressed investing, you're still an SA and M&A this summer will be a better experience. That said, you can still move from top M&A to distressed shop / move into restructuring FT.
Assuming the two shops are equal in other regards, and you do not strongly prefer one group of coworkers, M&A would keep your options open a bit more.
It is still quite feasible to go M&A -> Distressed, if you decide you want to pursue that route. It's a summer job, so I am guessing you do not have any actual PE experience. In which case, M&A might be advisable, just to improve your marketability to more traditional funds.
Like you said, this summer is going to be scorching hot for M&A. I'd jump on it.
Awesome, thanks guys!
Nooby
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Restructuring vs M&A and which team? (Originally Posted: 06/25/2011)
Hi guys,
Just a question - I'm in the fortunate position of having landed myself a long term internship at a top M&A house in London, starting in Autumn.
Having spoken to HR, they have asked me to let them know whether I prefer Debt/Equity Restructuring or M&A and which sector I'm interested in.
My gut feeling is that M&A's going to look great on my CV and will be more interesting, but I worry that I'd have less of a chance being converted full time there. Restructuring is generally the safer bet from what I've heard, especially in a slow economic climate. How would you make the decision in my shoes?
Also, in terms of which sector's the best - I'm keen on TMT, it's evidently a hot sector right now (especially media and tech), but I do worry that it's another bubble that could pop and see deal flow dry right up in the next couple of years. So you think a less 'sexy' sector like Industrials or similar might be a more logical preference?
Would much appreciate your advice.
As it's just an internship, your primary goal should be to improve your CV and take on more interesting roles. That's why I'd go M&A/TMT. Just work as hard as you think is necessary to gain a full-time offer, and place a high emphasis on fitting in with your team and networking with senior level staff so they think that you'd be a good guy to keep around.
Primary goal surely should be to convert to full time though, no? In which case, wouldn't it be smart to seek out desks that are more likely to be hiring?
Good way of thinking about it i guess, thanks. Any other opinions?
M&A. Broader options, will be busier over the next 2-3 years (arguably), and also, if you ever want to work in the U.S., M&A in London is much more applicable to U.S. markets, relative to Rx, with bankruptcy laws and practices/strategies differing stateside.
Need your opinion on my decision (Restructuring vs. M&A) (Originally Posted: 09/22/2007)
Hi guys -
What do you think about the following options: 1) say GS Restructuring 2) say MS M&A
How do you think would the skillset differ after two years? Do you think getting a job after GS Restructuring at a PE/Hedgefund would be more difficult than with M&A background? What about options in distressed funds?
Many thanks for your opinion! I gotta decide soon.
Do whichever you think would be more fun. You're actually going to have to sit there for all these hours and do the work, not just press a button and have the 2 years disappear. Both are great opportunities. Personally, I'd go with MS M&A because M&A is great.
It's for sure I will do whatever I think will be more fun. But that's a personal decision and you guys won't be able to help me with that. But what you could help me with is discussing the different exit ops. I think, restructuring offers decent options with regards to distressed funds? Is that a reasonable assumption?
Many thanks for your help.
Not all restructuring houses are the same. They do different things and have different clients.
As for exit opps - if you want to work at a distressed fund, yes, definitely work for a group that has distressed funds as clients. Then it's the same as any sell-side to buy-side transition.
If you want to do true down and dirty Chapter 11, workouts etc., the firms to go for are Blackstone, HLHZ, Jefferies, and Rothschild. Other firms might do things like offering various alternative/creative debt packages, and call it "restructuring." It varies.
I don't know anything about GS restructuring, but if I were interviewing for them, I'd ask what kind of clients they typically represent - debtors, creditors, equity holders, etc., and what kinds of assignments they take on.
Who would you hope they represent - if you were interested in doing restructuring at that firm (i.e., which would provide the best experience). I can windle it down fairly quickly to debtors and creditors, because equity holders are usually SOL. From there, I know that the debtor side does much more work since they're raising financing (DIP and Exit), valuing the company for distribution purposes, and very likely finding bidders for the non-core assets. I'm not certain as to what the creditor side would do, with the exception of objecting to valuations. Did I just answer my own question?
I don't necessarily have a preference, I just want to do interesting deals, and I'd try to get a feel for what they do. I'm less excited about being a debt salesman, so if the whole thing sounded more like a glorified corporate refinancing operation I would be less inclined.
If you're representing a creditor, you're basically going in and fighting for one of two things. Either you want your money back and you use all sorts of tactics to get as much as possible, or you want control of the company. Actually that's a bit simplistic - it might be a combination. Cash plus warrants? New securities? Whatever you can get. And you're right, you'll argue with all the other parties about valuation, asset sales, and everything else.
A really interesting assignment might be working for an activist hedge fund that's buying up slices of debt at a large discount, and trying to force a Chapter 11, or force themselves into control of the company. That's kind of like "creditor activism" a sort of "back door private equity."
Not all equity holders are 100% SOL - although it's true they're not exactly running the show at that point. Sometimes public shareholders can hire banks to be on their side, if there's residual value there. Delta Airlines, etc.
I should note as a caveat - I have very little industry experience (which I hope to change shortly). The above info is sourced from my networking with insiders and other research.
Timing the market: M&A or Restructuring (Originally Posted: 10/04/2009)
So I was wondering since offers come out around now what people would be looking at more to be the hot market next summer when new analysts start. Will restructuring still be hot or will new analysts going into restructuring get into the industry right when restructuring cools down and M&A booms? If you were going to pick a side to get in now, what would it be?
Fee free to make general M&A vs. Restructuring arguments not related to timing the market if you want as well.
Thanks.
Restructuring is definitely still hot, but bearing in mind that it is a two year gig I'd probably lean towards M&A. That assumes no other personal variables in the equation.
Keep in mind that there are vastly more healthy (M&A, industry groups, etc.) analyst positions than restructuring positions so I wouldn't target restructuring jobs only. Having said that, if you can get a top restructuring spot (doing mostly debtor-side work), I would seriously consider it. I think it gives you a better skillset than the healthy side and you can always make the switch from restructuring to M&A (going the other way is much harder).
What are your thoughts on creditor-side work? From talking to restructuring professionals at a number of banks (HL, EVR, LAZ, etc.), it seems like creditor-side work can be beneficial since you can work closely with PE firms, distressed HFs, etc., which means you develop that network and also learn to think like those investors would. Are the exit ops from creditor-focused banks (ie. HL) not as great as the exit ops from debtor-focused banks?
some firms lump m&a/restructuring together.
may be a good idea to track those down.
I'm making it up as I go along.
So how much would you value working at Evercore/Moelis which has the generalist model so you can do M&A and restructuring vs. working at somewhere like Lazard just in restructuring or just in M&A.
restrucutring is not in M&A ... its more like a liability management job
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