Why RX

Following

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A few reasons:

1) Your work is typically necessary to keep the company alive (for example, with a DIP or rescue financing), at least in the short-term, while M&A generally just allows sellers to realize value and buyers to pursue longer-term strategic/investment objectives.

2) Deals are more likely to actually close since the status quo is often not sustainable. I’ve seen quite a few M&A processes where the bankers go through all of the motions only for the sellers to decide at the last minute that they don’t like the price (or even some very insignificant aspect of the deal). In an Rx or distressed financing situation, the company often does not have the luxury of being overly picky or backing out.

3) There’s generally a larger deal strategy/game theory component. A restructuring is essentially a zero-sum game where you’re reallocating value among various existing stakeholders, unlike in M&A where a buyer can overpay and chalk it up to synergies.

4) There are far fewer bankers out there that have significant Rx experience than there are with M&A experience. This could be more of a point of personal preference, but if you appreciate the value of being a specialist and having more esoteric knowledge, it’s probably a benefit.