What is the general current reputation of Jefferies? Are they moving into the lower BB category? I know some groups like HC and Energy are historically very strong and compete at that tier. How are they viewed for PE/HF exits?
Also, does anyone have any input in how they are doing in the coronavirus crisis?
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Very strong and top player in the MM space with good growth, but wouldn't say they are near BB or if they ever will be one, even with the fall of DB and UBS.
You should ask their energy group about it
What even constitutes a BB anymore? Deal size? Prestige?
Jefferies will never be leading massive deals - it's not what they do and they won't waste resources chasing a $10bn+ mandate with a very limited balance sheet.
Their placement into PE/HF I believe depends heavily on the group - HC and M&A generally do well, and have been told that Industrials is getting up there too
I think the BB title is for banks that offer services beyond high-tier investment banking and capital markets.
They are the top MM bank. They won't ever move up to a BB level because that's not where they're looking to go. They currently do a great job within the MM world, that's their niche. They're the top player there. Their employees know how to do MM deals and have experience churning out a ridiculous amount of small to medium sized deals. If they start competing with BBs on multi-billion dollar deals, which they don't have experience in, and start giving up the small deals they used to work, then all they'd be doing is pitching and never making any money. Maybe they'd get a deal here or there, but they'd be making less money than before.
This isn't really accurate. over 50% of Jefferies transactions are on deals above 1 Billion. They close far fewer deals than other MMs like HL or Blair but have much higher deal sizes. They are a top player in leveraged lending as well and beat many BBs on these deals. They have been moving towards the BB level for the past 5 years and they do have a balance sheet.
Look Jefferies is certainly a strong bank, with great deal flow and exits if that is what you like, but they aren't near 'BB level' and will likely never be because that is not their intention.
did HR tell you that before you accepted your internship offer?
Being a bulge bracket bank has so little to do with investment banking. Those banks are BBs because of the many different services they offer. Jefferies actually does offer some of those services, like research and some level of S&T, but not at the same level as a JPM or BAML. RBC/WF are more in line to move up in the world--which is actually something they would want to do.
Can anyone share some insight on the IB LatAm group? I'm considering applying for a Summer Analyst role (2021).
Naive question...but do you need to be fluent in Spanish?
I'm wondering about the groups structure/ size, culture, and deal flow. Yes, from the research I've done on Latam IB groups in general, it's required to be fluent in Spanish or Portuguese.
anyone?
I feel like people here don't really understand what "MM" means anymore. Calling Jefferies a middle market bank implies that they compete (or are comparable to) your traditional middle market players (e.g. Blair, Baird, HW, Houlihan etc.) when the actual deals they do have a lot more in common with bulge brackets.
Outside of the whole Sage Kelly nonsense, Jefferies is probably best known for bringing absurdly high leverage (we're talking 6-7x+ with super shitty / loose documentation to boot) sponsor deals to market, often after a BB (say JPM or MS) fails to get it done the first time. That's clearly not something a MM bank does.
From an advisory standpoint, sure, they aren't working on $50Bn M&A deals, but they also aren't cranking out $200MM sponsor sellsides. Their typical deal ($1-2Bn corporate M&A) is very squarely in the BB playbook, not your typical MM. All told, Jefferies is clearly differentiated from what's traditionally referred to as "middle market" investment banking and has much more in common with the bulge brackets of the world. Overall, I'd call them a "shitty bulge bracket" rather than a "top middle market"
Finally.
I agree their banking platform is discount-BB and they definitely compete on BB level mandates in multiple sectors, but I don't see how that applies to Jefferies as a whole. They don't offer asset management, PWM, or S&T on the level of the actual BB banks. I'd just think of them as an in-between-bank.
Comment above me captures Jefferies reputation very well.
A lot of folks asking is it BB or MM. It doesn't fit nicely into either group. As people have already said, its not what we traditionally think about when we think of the BBs. On the other hand, MM is off too, because they're probably more often competing with the BBs. So let's just all agree its between the two. Not everything fits into a bucket.
As the commenter above says, the reputation is a pretty aggressive one. They get done what other banks have been unwilling to get done. If a levered acquirer wants to do a cash deal that will require a convert, some of the bigger banks may say that's too much execution risk for them. Jefferies will not. Any time Carl Icahn wanted to push hard on something like his contingent rights offerings at Clorox and Dell, Jefferies was his go-to. His more recent shenanigans at Hertz probably have Jefferies advising him. Not every bank will work with a guy like that and partner with him on all of his moves. There was a company called Alere ("mini Valeant" I like to call it) that did 100 deals in 10 years. Rolled up the balance sheet like crazy and then went to shit. Jefferies was behind most of those 100 deals. Not every BB would chase that kind of relationship. They'll take the business but they won't chase it.
The bigger groups there will have good shots at PE exits. HC, Tech, M&A, Industrials.
This is accurate. HC / Energy are the top coverage groups. M&A has always placed well in the upper MM. Lev Fin has placed into top credit funds over the last 2 years given the rise in its Lev Loan segment. Industrials and Tech are very respectable and send a solid chunk to $1-3bn funds.
Overall, the culture is a mix of ‘chip on the shoulder’ and fratty - but highly dependent on group.
Can confirm. Overall though everyone is fairly nice and gets along well. The 'chip on the shoulder' guys tend to just be insecure but don't really rub you the wrong way. Very little backstabbing or sharp elbows, especially at the junior level
Jefferies are certainly a growing presence - recently started to compete with my BB in Industrials, as well as last couple of years in the TMT and HC sector. Probably biggest strength is that they seem to know (and be happy) with their position - they know that they're not a BB and they don't spunk massive resources on deals that they just can't compete on. But when it comes to the larger MM deals, they're often a first choice firm. Although, from speaking to others in Consumer, Real Estate etc. JEF seem a lot less present on the larger deals in these sectors in EMEA at least.
Last couple of years? Its been competing for large HC mandates for a long time now.
apologies, can only speak of my experience in the last couple of years (as an analyst 2/3). Given most users on here are uni students, thought it’d still be worth giving my couple of years viewpoint
d
They only do lower MM in Europe
Not sure what you class as lower MM, but was looking at the Dealogic numbers today... in Europe, Jefferies total deal value was over $62bn with 67 deals which gives an average deal size of just under $1bn. In the UK specifically, the average deal size is over $1.25bn. Given these are averages too, your definition of lower MM must be $5bn which for 2018 was roughly 5980/6000 deals announced. This amounts to 99.7% of all deals being lower MM...
Now recount without the Fairness Opinions
Is their app still open? Where are they at in terms of recruiting for next year’s summer program?
anyone have thoughts on their S&T presence? comparable to BB’s?
bump also does anyone know about the recruiting timeline for S&T
Bump
JEF is always aspiring to be BB, but falls short. HC split between services and life sci. Services M&A oriented, carried by a single banker named Agabs; life sci is mainly equity driven. Don’t listen to the bullshit they speak of.... they are not a player when it comes to biopharma M&A.
they have a different niche in the market - they aren't aspiring to be a BB per se. They just found a spot that works for them
Of course they aspire to be BB. They had it in their god damn pitchbooks “Jefferies is Bulge Bracket”
Cant speak in terms of the whole bank but have friends in Energy. Their energy group in Houston is easily Tier 1 - competes with the likes of Citi, EVR, MS, GS etc on top energy mandates.
This is true - their team is 100 employees in Houston, 50 bankers and 50 geologists etc. Their analysts get paid what associates are paid at other firms.
Lmao are you serious? This is a serious question no sarcasm intended ####
bump - would you be able to provide an updated view?
Was speaking to a family friend who is a partner at a PE firm and talking about banks and when I asked about Jefferies, his adjective was “shady”. He couldn’t really give me a good reason why, but said a lot of people on the buy side look down on Jefferies for whatever reason. Said they’ve had their share of scandals and generally the upper management are awful people. Even though from a deal perspective it may compete with BBs and is probably working on bigger deals than a classic MM, it has a certain stigma that both BBs like UBS and top MMs like Blair/HL/etc don’t have. Can anyone confirm? Did this guy just have a bad experience with them?
JEF is a scrappy bank. Could mean shady to some.
accurate. handler is a loser - he should get off instagram. they hire a lot of guys who couldn't cut it from morgan, for example
Anyone have any thoughts on Jefferies tech team in London?
Very strong team. Pretty heavily European and top-heavy. 3rd highest fee revenue pool in 2020 behind HC and Industrials within JEF.
Anyone know anything about their FIG group?
Brutal hours but lots of responsibility
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