HL FAS Group - Any thoughts on work, lifestyle, comp, exit opps?

monkeyshine271's picture
Rank: Monkey | 44

Hi everyone,
Hope you can help answer some of my questions about FAS.

I know HL FAS does tons of fairness, solvency opinion work along with goodwill impairment, PPA and it isn't as respected as Corp Fin and Restructuring. But, I'm wondering if there is a way to get any exposure to deals/M&A within FAS. Are there opportunities to work across teams that deal more with M&A type work?

How difficult is it for an analyst in FAS to switch to their corp fin group?
How is the compensation in terms of salary and year-end bonus?
What are some of the exit opportunities? Would I have to switch to M&A before making it to a decent PE?
Top 10 B-School opportunities from FAS?
There is also much talk about client interaction at the junior level relative to other boutique/middle market banks; how much client interaction is there at the analyst level for FAS?

Thanks!!!!!

Comments (26)

Feb 17, 2014

I reached out to a buddy who works in HL FAS. I'll let you know.

Robert Clayton Dean: What is happening?
Brill: I blew up the building.
Robert Clayton Dean: Why?
Brill: Because you made a phone call.

Feb 17, 2014

Great, thanks a lot!

Feb 17, 2014

Not sure if I can be the most helpful, but I did have a superday at Houlihan FAS this past fall. After talking to the guys there, its seems distinctly different from their Corp. Fin. group with little/no exposure and not a realistic chance of moving over. However, if I had to venture a guess, I would say that the skills/name would be enough to be able to transfer to a boutique/MM IB after a year or two.

My honest opinion of the group was that it was sort of a B-team within HL. Not to say it wouldn't be a solid starting point, but the majority of people there were from Big 4 audit and mediocre schools--Again, not trying to sound negative, just not the culture your used to seeing in IB. From the research I did the base salary was the same ($10k+$70K) with a smaller bonus(...Maybe $10k?).

If this is for a SA, I think it would be a great alternative for somebody looking to leverage it into a FT IB offer. If FT, still a good name and similar skills to IB. Wish I could be more helpful, and my info is somewhat anecdotal, but that's all I know about the group.

Feb 18, 2014

Thanks for taking the time to respond. Which office did you interview for? West/East Coast?

Nov 22, 2015

Not as tough to get into as M&A or RX so not highly regarded at the analyst level among jobs in finance. This shouldn't matter that much as some of the most respected people in high finance had the most unconventional and unique paths.

They are also one of the market leaders in that space along with one or two other valuation shops. So you will actually build a great skill set there which is relevant to pretty much every job in finance. I'd actually argue that you'll become better in excel / modeling than most IB analysts just because you're job is to value different securities. If you wanted to, you'd easily be able to move into IB as long as you don't stay in valuation too long.

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Nov 22, 2015
  1. I would not categorize it as traditional IB; more valuation work, but very well respected
  2. Middle market PE, Business Development, Corp Fin
  3. Depends on location; figure 75 - 85 hrs on average
  4. Fairness Opinions, PPAs, Solvency, Goodwill impairment, etc.
  5. Of the three divisions at HLHZ, it is the least profitable. As such, Comp is traditionally lower than Restructuring and Corp Fin. I'm not 100% on actuals though.
Nov 22, 2015

sounds like a good group

Nov 22, 2015

fairness and solvency? not sure, someone else can prob elaborate better

Nov 22, 2015

Yeah the FAS team take care of a lot of Fairness opinions. It means the work is clarifying and checking the deal valuations and models are kosher. It would provide good model skills especially cash flow modeling, however I believe that the exit opps would be far greater in an M&A team.

Nov 22, 2015

do you think there would be potential to lateral to M&A? also, i would imagine, moving to maybe l/s equity or something like this would be possible, since you are looking at companies very closely on a stand-alone basis; is this fair? any more color would be great; thanks so far

Nov 22, 2015

i interviewed with all three groups and my impression of FAS is that it's really focused on what it does, which is fairness opinion. Corp fins and restructuring do their own valuations. i feel like the three groups do not really interact with each other and i would say it depends on what you want, FAS will definitely give you great experience in valuation and modelling, but corp fin and restructuring seem to focus more on execution. But again, this is my IMPRESSION from the interviews. I never worked with them so I do not know for sure...

Nov 22, 2015

for doing FAS? again, all the help is much appreciated

Nov 22, 2015

how would you prep for this interview?

i've done banking up till now, but haven't had crazy amounts of modeling, so that said, what specifically should i focus on?

Nov 22, 2015

....

Nov 22, 2015

i actually do remember interviewing with these guys awhile back; seemed like good ppl, but it was awhile ago

Nov 22, 2015

FAS is completely valuation-based. Also known as, fairness opinions. You may think that valuation-intensive work is desirable, but your options are severely limited coming out of FAS. The reason is that FAS analysts are not expected to cultivate relationships like "front office" bankers in M&A are expected to. There is an entire deal process that involves much more than mere valuation. Your skills coming out of M&A would include those that you would acquire in FAS, with the added perspective on what makes a deal attractive, how to deal with clients, how to sell a company, etc.

I don't personally know anyone in FAS, but many of my classmates dropped interviews with them when they discovered what kind of work they would be doing.

Nov 22, 2015

^ The poster above has no idea what he is talking about.

First of all fairness opinions are infact issued by the sell-side investment bank, to convince the selling shareholders that the offer is indeed a fair price, so there is litigation risk here for the IB. Valuation firms do not issue fairness opinions on deal pricing because of the legal risk and conflicts of interest.

Occassionally, for HLTs, (levered) a valuation firm may issue a solvency opinion to show that post-deal the company will still be a solvent going-concern and not in severe risk of insolvency after closing. You see these types of reports in the LBO merger proxies and other leveraged recaps that could tilt the company into credit default.

The valuation firm issues fair value, or fair market value reports (depends if its for tax or GAAP) to aid the client in the purchase price allocation or a 1060 allocation if its on the tax side. The opening or post-merger balance sheet reflects the work of the valuation firm which is extremely important to the client because how you allocate goodwill, and do the step up can have substantial effects on EPS going forward, especially during a recession.

The skills, tools (CapIQ, etc.) utilized are exactly identical to those obtained in IB, or ER if not more because of the additional experience obtained in basis step ups for M&A tax - IRC 338's, 751's, etc. The client exposure is also great - in fact more so than analyst level IB, because you have to interview the client when making cash flow projections to re-value the business for financial reporting purposes.

A good amount of MD's and VP's i've met in IB/PE started out their careers in valuation groups of various TAS in the larger accounting firms. You get exposure to all facets of a company's capital structure and your exit opps are just as good as anyone in the M&A business.

The edge IB's have over valuation firms is the financing aspects of the deal. This is where valuation firms fall short, and the IB shines. IB's can quickly underwrite debt, equity, hybrids, syndicated loans - raising money for your deal - while distributing the financing risk to investors all over the world.

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Nov 22, 2015

I thought HLHZ's financial advisory unit was included within their banking division; is this more like working for KPMG, or a similar firm? Sorry for sounding so clueless about this; I have already had banking experience, but only a year+'s worth so far, so that's all I really know. I am applying to HLHZ because it is a better firm. Anyone else that can provide more color on this, your help would be greatly appreciated.

Nov 22, 2015

FAS is completely separate from Corp. Fin. at HLHZ. If you work in FAS you don't do M&A, if you work in M&A, you don't do FAS. End of story.

Nov 22, 2015

coming from HLHZ fas? is it stupid for me to go from banking to this? right now i do tmt at a less prestigious bank than HLHZ

Nov 22, 2015

Exit Opps from FAS are very different than from Corp. Fin. You don't get the same skill set in FAS or the same kind of exposure as you do in CF. This is not to say that you don't gain a ton of technical skills in FAS, it's just very tailored to what they do, fairness opinions. People hate on FAS senselessly, but it is definitely different from CF and will lead to different opps. I can't speak too specifically on what people do after FAS, unfortunately, but I am fairly certain that it's different from banking exit opps.

Nov 22, 2015
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Nov 22, 2015