The term Mergers and Acquisitions or M&A is a generic expression that covers transactions that affect the Equity , and therefore the Shareholders, of a company: buying, selling, raising funds, or listing on the Stock Market.
Several types of professionals may be called upon under such circumstances:

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The investor: The investor’s business consists in investing the funds that he is managing in companies in which he usually then becomes a shareholder.

  .  Investments in unlisted companies are referred to as Private Equity investments. The shares are purchased with the intention of selling them within four to six years. One of the investor’s primary concerns is the liquidity of his shares, which will enable him to achieve the expected profit and financial return.
  .  In some arrangements, the investor holds an intermediate position as a bondholder, usually holding a right to become a shareholder under predefined conditions.
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The lending banker: Unlike the investor, the banker is not a shareholder. He does not attend the General Meetings. His investment is compensated for by interests and he has to ascertain that the loaned funds can be repaid, both in interest and principal. These funds do not usually belong to the Bank, they are borrowed on the market. The debt raised for a transaction may include several “tranches”, each of which having its own terms and conditions. This debt may be paid off in various ways, with linear, progressive, deferred or even “bullet” payments.

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The Investment Bank/Adviser:   The investment banker is neither a lender nor an investor, he is an adviser specialised in Equity Transactions and Financing.
Historically, this activity was conducted by banks. In the last twenty years, with the development of financial transactions, it has become a highly specialised business in which independent advisers hold a significant position.
Positioning of advisers varies widely, depending on:

  • Size of deals: transaction values > €150 million, between €30 million and €150 million (mid cap), between €5 million and €30 million (small cap) or under €5 million
  • Type of service provided: from simple matching of parties to complete support throughout the deal, up to closing.
  • Business sector: professionals handling the largest deals usually have access to teams that are specialised in major business areas. In contrast, for mid cap and small cap transactions, the teams are usually generalists. Their cumulative experience, proportional to their seniority in the field, brings them ample expertise to understand most business contexts. Some players are specialised by business sector, specially in sectors such as high tech, biotech, food processing, etc.
  • Size of teams and the organisation of work between the Partners and Associates.
  • Scope of activities: some players are active in other financial services, such as acquisition financing, equity investing, private banking services, etc.
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Other consultants: There are almost always other types of professionals involved: business lawyers, tax consultants, public accountants, firms specialised in , strategy and organisation, environmental , specialists etc
  .  Private bankers: The Private Banker service consists in advising individuals on their personal Asset Management. In Family owned Companies sales, the Private Banker takes care of the patrimonial interests of the seller(s). He usually prepares the transaction from a patrimonial viewpoint, and helps the seller in managing his cash afterwards.