Sell-side Fees

Hey everyone,

I wanted your quick input on what fees one should expect an IB to be paid for sell-side services to a private company that will be sold for circa USD 500 million (=Equity Value, Debt = 0) through a targeted auction.
I guess that would be categorized as a "middle-market" transaction.
Should I expect something in the area of 1%, i.e. USD 5 million to be paid upon completion?

Thanks,

George

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Comments (9)

Feb 28, 2020 - 10:53am

isn't sell-side less risky than buy-side where you're essentially one of a handful of banks competing for the same asset? conversely, with sell-side, you're the one bank helping sell the asset to a handful of competing parties?

if this is the case, i'd rather work for a firm that has 100 sell-sides than 200 buy-sides.

Feb 28, 2020 - 11:04am

Sell-side is less risky from the perspective that you aren't putting any financial capital at risk just time, and if the asset doesn't sell then you obviously don't get paid your fee and you put in all that time and work for essentially nothing. However, on the buy-side their is financial risk in the event that the investment of buying the asset does not pay off.

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