Switching from 'Industrials' to 'Restructuring'.
Hey!
So, a bit of a background - I'm a soon-to-graduate engineer that's currently looking at MSc in Finance programs in Europe to get into IB. Reasons? Initially, it was the money, but after diving deeper into the field, I've discovered that the work is pretty interesting too. I know that life would suck, especially for the first couple of years, but I'm willing to put up with it. My family has struggled a lot, and I'd like to ensure a safe future for them.
Moving on, I'm primarily interested in working with distressed assets and other special situations through restructuring, and would thus like to work in the 'Restructuring' group of a BB or MM, or with an EB in the field such as Lazard, HL or PJT.
The problem is, that my best chance is to actually break into the field is by leveraging my engineering background to break into the 'Industrials' coverage group instead. So, my question to you all is, if I do pursue this, will it be possible for me to transition to restructuring at a later point of time? I really have my mind set on it, and would like to eventually end up in a distressed-focused buy-side firm.
Thank you.
EIG
Hey EverythingIsGray, sorry about the delay, but are any of these useful:
Fingers crossed that one of those helps you.
The fact that you study engineering doesnt force you to work in industrials - group placement is usually independent from recruiting. You could argue that TMT is also suitable for an engineer... Anyway onto RX - Industrials companies are often in distress as they tend to have higher leverage, hence it would make sense. Not that at some firms you’ll be able to choose to be working on RX ie PJT, but others (Rothschild/Lazard) have groups that are specific for Rx and getting placed there can be quite random.
I didn't know that group placement is usually independent of recruiting. I thought that banks would ask the applicants about their interests and desired group, and then conduct the interview around that. But I guess the recruiting is more generic?
I just thought 'Industrials' would make more sense to potential recruiters, given my background.
If you are interested in restructuring, pursue restructuring. Reach out to restructuring bankers. Learn about how different professionals got into restructuring. Start following the distressed debt market. There are more than enough resources on this site and others to help you recruit into and secure a full-time opportunity in restructuring. There's no need to do an intermediate stop in industrials banking.
Also, in my experience, it is fairly uncommon for bankers to move from a coverage group into the restructuring product, outside of Oil & Gas in 2015.
Oh, okay, that's great to hear. My reason for looking at 'Industrials' is that the guide on 'mergersandinquisitions' for people with technical backgrounds suggests that I stand a better chance if I'm able to leverage my past education and portray that I'd like to advice companies in my field (I'm a mechanical engineer) on various transactions through an industry group. Unfortunately, my reading suggests that restructurings don't come under industry groups, due to more complex technical and legal challenges, and that they are exclusively catered by the Rx product group.
Like others have said, companies in the industrials vertical often end up in distress due to high leverage and cyclical nature. You don't have to abdandon leveraging your technical background, but if distressed advisory interests you the most, then go directly for that.
If you are recruiting into an analyst role, investment banks are going to be looking for smart, motivated candidates that have the ability to think logically, take on responsibility for work product, and present well in front of clients. So it's more important to have great grades, show maturity and curiosity, and be able to figure out problems without needing someone to hold your hand along the way. This is especially true in restructuring groups that are smaller groups relative to the M&A product offering at most banks.
In the above scenario, the best advice I could give you is be scrappy. Read Moyer. Find out if your university library can get you student access to DebtWire, Reorg Research, LCDComps, etc. Start following interesting distressed situations. The more capable and prepared you can be for informationals with restructuring professionals, the more likely they are to pass your resume on to hiring managers.
If you are recruiting for an Associate or VP role, I would tend to agree with you more with regards to selling your education and experience as relevant.
I mean it isn't impossible. I know coverage guys that have made the switch, and they don't all come from energy groups. More common to see levfin, hy research, or turnaround consultants make the switch, but it doesn't mean you can't as a coverage banker. Will caveat by saying that this is for the U.S. - don't know what it's like in Europe.
So, what was the process like for the people you know, if you don't mind sharing?
It had more to do with the opportunity being available for the people that I actually know well (as in, there was an immediate need for another analyst, usually because someone was leaving). I know others that have made the transition, but I've never asked them about their process or anything.
Honestly though, if this is your first job out of college, I'd just recruit for rx directly like the other guy said. You can still recruit for coverage at a BB as your back up.
hello there?
Hello! Are you in the same boat? Or do you have something else to contribute?
Restructuring seems to attract of a lot of attention these days.
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