What about a M&A analyst job and career?

Why do young people want to go into M&A?

In this article I want to give you some insights in the world of M&A. What is the reality of an analyst life in mergers and acquisitions? What does a M&A career do to you? What are the disadvantages of a M&A analyst job? Is the merger and acquisition and Corporate Finance lifestyle for you? Can it be done differently?I hope to get a discussion going here about life in M&A. The opinion of one person on the life of M&A analysts can never be sufficient given it is only one opinion. Even this opinion on an M&A career might change depending on your success rate, company you work for, number of years in the field etc. Therefore more people should give their opinion and let you know what life is like as a M&A analyst.Why investment banking? While being in university or in an early corporate career many young people spread the word that working in corporate finance or mergers and acquisitions is the coolest thing there is. Speaking for myself, while being at General Electric Capital in Europe in the nineties of last century I and quite a few other FMP (Financial Management Trainees) were offered the opportunity to go and work in London or New York investment banking with high pay and huge bonuses. Is it mainly the pay or the status these jobs have to many students? Or do people like the learning curve and the detailed understanding one gets of how a company operates? Where a company might improve in the future, and which synergies exist via acquisitions. It is often genuinely stimulating work where you learn a lot in a short time. However, isn’t this also the case in strategy consulting, audit staffs of large corporates and many business development jobs? So why is the mergers and acquisitions analyst job so desired? Or is it maybe not the analyst job, but merely the partners position that people want? And is the only way to get to a partner position via the analyst job?

Objective of this article about the M&A analyst career and job

The objective of this article is to give young people that want to go for a career in M&A an opportunity to understand what the jobs in this industry really comprise of. At Corporate Finance in Europe we can get you actively involved and get you some learning experience for free. This can help in getting your expectations about a M&A analyst job more realistic. I also hope that it can help you to determine if you are on the right track and if this is what you like. I am very much interested in your opinion on the job circumstances of a M&A analyst. What do you see or what did you experience yourself? How is the work life in practice and is your opinion about M&A work and circumstances? Please reply and give your opinion below the article.The article consists of the following pieces:

  • What does the daily work of a M&A analyst normally consist of
  • Detailed description of daily M&A analyst activities
  • Difference between M&A jobs for large companies and SME’s
  • Interesting aspects of M&A (merger and acquisition) jobs
  • Disadvantages of M&A (merger and acquisition) analyst jobs
  • Industries M&A (merger and acquisition) and Corporate Finance teams
  • Opportunities to learn about merger and acquisitions at Corporate Finance in Europe
  • Opinion on merger and acquisitions analyst jobs in Europe
We want to show you how mergers and acquisition analysts work in the different countries in Europe. Countries that are of a special interest to us and where we want to work together with independent mergers and acquisition analysts are Austria, Belgium, Finland, France, Germany, Italy, the Netherlands, Poland, Spain, Switzerland, Turkey and the United Kingdom. Please get in touch with us if you are located in any of these countries, dominate the local language as well as English and are interested in testing the work of a mergers and acquisition analyst. We will show you how the work of a M&A analyst is in practice. Finally, if you want to get a good name on your CV please reach out to us.

What does the daily work/job of a M&A analyst normally consist of?

An M&A professional's mission (analyst) is to guide a transaction toward a successful conclusion. Duties may include:

  • Prepare pitches
  • Company valuations and deal structuring
  • Sell side processes
  • Buy side processes
  • Due diligence
In practice the work of a M&A analyst is different in each office or company you get into. However, doing a test with CFIE will give you a flavour of the career and if you are suited for it or not. Further, you will find out what you like. At the same time you will get a more realistic feel about what the daily work of a M&A analyst contains.

Prepare pitches as a M&A analyst

Preparing pitches is one of the main tasks of a M&A analyst job (M&A career) . It is a crucial task as winning (‘landing’) an assignment means that a large chunk of work with a related pay is coming in. Given there is much competition from other M&A suppliers it might as well be the most crucial part of the project and hence the analyst needs to do his/her utmost to prepare a good pitch. You have to analyse the company in detail and understand which competitors are out there. As a part of a M&A career and as an analyst job you perform valuations of similar deals. Using Mergermarket, Bloomberg, Bureau van Dijk or any other M&A research database helps a M&A analyst to get the required data to prepare a good analysis.

Company valuations and deal structuring

Preparing financial models is part of the valuation and deal structuring phase. In this stage the M&A analyst performs a combination of appraisal techniques. It is possible that you use models such as the discounted cash flow (DCF) method. However, in larger firms it is also likely that this work gets done by the Valuation Group and you never get involved in as a M&A analyst. Normally, a M&A professional would look at similar companies within the industry and assess comparable multiples. Deal structuring involves securing financing for a deal, pricing and assigning ownership (shares), earn-out constructions, etc. M&A analysts are normally not really involved in this process, but at least you see how it works.

Sell side processes done by a M&A analyst

Finding the most suited buyer for a project is one of the most important parts of the process. This is mostly easier with larger deals where there is a more limited number of buyers. During the process of exchanging information most companies become classified as not feasible for a potential acquisition. Pricing expectations can be unreasonable, financing will not be achievable or the target's direction may not be aligned with the acquiring company's. A substantial difference in culture can also be a deal breaker. For more information on the activities in a sell side project please read more at sell a business in Europe.

Buy side processes

Getting into a M&A career means finding suited sellers. A major part of a M&A analyst job and work is to find suited targets. This is an important part of the buy side process. It involves understanding the strategy and the industry of the buyer well. Once the strategy is well understood, properly identifying and communicating with potentially relevant target companies is a large piece of the buy side work. This is done based on defined acquisition criteria directed by the management of the buyer. For more information on the activities of a M&A analyst in a buy side project please read further at buy a business in Europe.

Due Diligence (DD)

If you are in a Transaction Services department of a Big 4 you can be assigned to the Due diligence team. This is a different route in the M&A career but can be a good start for a M&A analyst job. This means you are normally involved in the process of evaluating and confirming financial and operational information of the target company. This means performing operational, financial and legal risk assessments of a company. Mostly, it is financially oriented and you are producing 100 pages plus reports on the companies financials, the Balance Sheet, P&L, cash flow and working capital. Here you can read more about the Due Diligence process.

Difference between M&A jobs for large multinationals and SME’s

When people refer to M&A jobs it can still be a large array of analyst jobs. You can work in investment banking, a Private Equity firm, Corporate Finance or M&A consulting for SME’s (the lower and middle market let’s say deals with a value of 2 to 50m Euro). In practice referring to investment banking means the real large deals (let’s say a Billion Euro and over). Given the deal size is so large you normally work with a full team and get a much more specific piece of analyst work. You can be active in Due Diligence within a Transaction Services department and focus on Due Diligence projects only. Given a deal needs to be done quickly and a buyer wants to know the outcome of the Due diligence fast, you have to work a lot in a short time frame. For investment banking analysts jobs the same applies. You can have very quit periods when there is limited work, but when an assignment has been won, you have to work at full speed until a closing happens. In business sales for SME’s (the lower middle marker) it is also hard work, but in many boutiques the working hours are more modest and the live/work balance is better. Given M&A boutiques are mostly manager owned companies your analyst job activity depends a lot on the view of your manager, who is the owner.

Interesting aspects of M&A (merger and acquisition) jobs

Jobs in M&A are among the most competitive and wanted among young finance people. Of course the money is mostly great. I know a few investment bankers who, at the age of 35, had already accumulated more than a million GBP in savings. Does it change their lives? That’s up to you to answer. Working in M&A teaches you how to consistently deliver under high pressure. This can be a support in a further career, whatever type of job you want to pursue. Working as a M&A analyst teaches you discipline and attention to detail as often you will get your work back from your superiors asking for higher quality. Making financial models and presentations will be an built-in automatism for you as well as your high quality standards. M&A develops your people skills and gives you a thick skin. You will also learn to see the "big picture" corporate strategy and if you are lucky you will be working directly with CEOs and CFOs on corporate restructuring, strategic acquisitions and IPOs. However, in many cases this is just the task for the managing partner and you will be left behind in the office to continue the work when they come back from meetings.

Disadvantages of M&A (merger and acquisition) jobs

Long working hours are one of the major complaints in investment banks, although for some people it can also be a badge of honour. Therefore the opinion on a M&A analyst job can be completely different for each individual. Another important point to notice is that you get used to 12 to 14 or 16 hours a day of work after a while and each hour less feels like an ‘easy’ day at a certain time. Winning an assignment is the crucial thing so the fact that ‘customer is king’ is more evident in M&A than anywhere else. Managing partners will always please the client. Everything is possible and just a pleasure for the investment bank to comply with. Hence, there is a 'push down' culture in M&A. The managing director deals directly with the client and needs to promise many things to the client. The actual work gets kicked down to the associates and finally to the M&A analysts. So in the end it will be you, as a M&A analyst, who will be doing the real work. The hard work in a M&A career might reduce your lifespan by a couple of years as it is eating energy out of you. A further question is what it might do with you as a human being. Many junior analysts or investment bankers turn into arrogant individuals after various years in a M&A career. If you are not a strong character and lose perspective, a M&A career can turn you into a narrow-minded individual with a high focus on monetary things and number of deals closed. Of course, if you manage to balance everything and maintain control it can be a win-win solution for you. So, being an investment banking analyst can be OK if you like the work and are able to adjust yourself to the requirements. For me I learned over the many years in M&A that I am open to work hard, but prefer to do this at my own time. I also want to be able to take an afternoon of when the weather is nice or when I want to do something else. That’s why I became independent early on (in 2001) and started my own firm. Working in weekends or late at night is no issue for me, but only if I feel it is necessary and it will pay off for me.

Industries M&A (merger and acquisition) and Corporate Finance teams

If you start as a merger and acquisition analyst you normally get allocated into industry teams. Especially within larger investment banks or with small boutiques with an industry focus. Mergers and acquisitions are often divided up into industries. Some of these M&A industry teams where you can start as an analyst are:

  • Manufacturing
  • FMCG
  • Transport
  • Pharma or health care
  • Financial services
  • Food
  • Information technology
  • Transportation and logistics
  • Engineering
If you have a preference for or a strong interest in a specific industry please let us know what industry you are good at and we can help you get into M&A in this industry. This can mean you work on building an European M&A team for this industry. Further, you can make profiles of companies for sale or wanted in this industry. We can help you to get further experience in this field and make you share in the future revenue of the industry you work in. Writing a lot about M&A in your industry of choice is crucial. This can be done next to a normal job for the first one or two years or while being a student. So if you want to get into M&A please reach out to me and we can do a test case together.

Opportunities to learn about merger and acquisitions at Corporate Finance in Europe

At Corporate Finance in Europe we are happy to get you practical information about what activities exist in mergers and acquisitions jobs. However, don’t think every activity will be part of your favourite work. We see a lot of difference between young people that work for us. The reactions are mostly not what we expected before these people started as an analyst. But young people learn about what they like in an analyst job and also what they don’t like. We give you the opportunity to perform as a country or industry (support) manager. You will not spend a lot of time with clients at the table as the companies are based all around Europe. In the SME world retainers are lower than at large deals and often a point of discussion. Many business owners want to pay as much as possible on a success base and as little upfront.If you work as a mergers and acquisition analyst for a specific country you will work on company profiles for sale in that country in Europe. We are very much interested in young people for most of the larger countries in Europe. Countries that are of interest to us and where we want to work with independent mergers and acquisition analysts are Austria, Belgium, Denmark, Finland, France, Germany, Hungary, Ireland, Italy, Latvia, Lithuania, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, Switzerland, Turkey and the United Kingdom. At Corporate Finance in Europe you can learn and write about what buyers want. Making a description (a buy side profile) of an acquisition target is an important part. As well as making an anonymous description of a sellers company that will be offered for sale. We will give you an idea what the actual work is of an analyst. Our plan is to get you, step by step, more involved in our M&A activities. At the beginning you can do your M&A analyst work next to your job. Over time you can get more responsibilities and share in the income of your M&A work as well. In the long run you can be offered a M&A analyst job and work full time with us. We hope that our cooperation continues for many years or even decades.The companies we work with are normally in the lower middle market (valuation of 1 to 50m Euro). This can be something you like or not. Regularly young people want to do big deals, but in practice this can mean that you only analyse a small part of the company like the working capital or the fixed assets. Contact with senior management or owners in a large M&A transaction is less likely to happen.So even if you don’t like what you do you will still have learned something. This can be something small as what you do like or don’t (example purely financials or writing about strategic acquisition criteria). Please reach out to us if you want to cooperate in the area of M&A.

Opinion on merger and acquisitions analyst jobs in Europe

I am very interested to hear your thoughts and opinions on how the daily life is in the mergers and acquisitions world and if a M&A career is worth pursuing.

  • What are your experiences with M&A analyst work?
  • What is the reality of the day to day life in the M&A world?
  • Is it worth breaking into M&A activity and have a career in this field?
  • What does working in M&A do you with your personality?
  • What is the perception of the outside world on the M&A industry and is this perception correct?
  • What should you advise people that want to go and have a career in M&A?

Please provide your answers and personal opinion below.

   


Comments

Gabriel | Thursday 24 September 2015 | website: non
just want more information on the M&A in medical equipments Regards

Matthew | Tuesday 16 February 2016 | website:
Would like more information on the Financial service sector of M&A.

Thank you

Adan | Monday 6 June 2016 | website:
I have just read through your blog and I would like some more information in mergers and acquisitions especially in the financial service sector. Regards

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SHANTANU MUKHERJEE | Saturday 15 April 2017 | website:
I am currently in marketing. But I want to make a career in M&A. I Want to know what do I need to do to make a career in M&A.

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