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What is M&A?
M&A simply stands for ‘Mergers & Acquisitions.’ A merger refers to the combination of two companies (usually of a comparable size), whilst an acquisition occurs when one party – either a strategic buyer (e.g. a company) or a financial buyer or ‘sponsor’ (e.g. a Private Equity firm) – purchases the shares of another company. These transactions are typically some of the biggest events a company can go through, with the term ‘M&A’ covering transactions ranging from multi-billion-dollar mergers that will dominate business news to sole traders selling shares in their businesses to retire.
Company Shareholders and Management Teams do not typically experience these events regularly, so it can often be a significant life event for them. As a result, they will look to appoint advisors to help them prepare the business, deliver strategic insights on market participants, and maximise value for shareholders – that’s where Houlihan Lokey comes in.
What does ‘independent advisory’ mean?
Many global investment banks offer a variety of products that they look to sell to companies they work with. One of the main products sold alongside M&A advisory is financing solutions, such as the issuance of debt to support a business’s operations.
Whilst this can be advantageous for banks to boost revenues, it can often lead their advice to focus on maximising value rather than delivering conflict-free advice. An independent advisory firm such as Houlihan Lokey only provides advice, and therefore, it does not deliver conflicting advice or take any balance sheet risks.
What is the ‘mid-market’?
The mid-market typically refers to transactions valued between $100m and $1bn, but can also stretch above and below these values in reality.
Whilst there are a small number of ‘mega-deals’ valued in the multi-billions each year, these are somewhat unpredictable and have vast teams covering them. In contrast, there is a much more constant flow of deals in the mid-market, with smaller teams allowing each individual to make a bigger contribution to the deal, regardless of their level.
What M&A advisory services does Houlihan Lokey offer its clients?
Within our M&A business, Houlihan Lokey advises clients on both sell-side and buy-side transactions.
On the sell-side, Houlihan Lokey will act as a strategic sounding board and hands-on advisor in preparing the business for sale, managing due diligence of potential buyers, and helping to negotiate the final transaction. On the buy-side, Houlihan Lokey will support a potential buyer with market insights, valuation support, and additional advice and due diligence, which will help underpin a buyer’s investment thesis.
Houlihan Lokey also has several advisory teams across equity and debt capital markets, which will often support on an M&A transaction. Our M&A clients can range from scaling owner-managed businesses, to cutting-edge Private Equity-owned assets, to large industry consolidators.
How is working in M&A advisory at Houlihan Lokey different?
Acting within the mid-market, Houlihan Lokey operates in lean deal teams, which means you are exposed to senior colleagues and clients very early in your career. Deal team members contribute to every aspect of an M&A process – from an initial meeting with a prospective client, to working with them, to closing a transaction – rather than focusing on a narrow, specialised task or step in the process, which can be common in bulge-bracket firms.
M&A teams within Houlihan Lokey are sector-specialised, allowing them to deliver unparalleled insights within specific industries to their clients. Our high transaction volume increases individuals’ exposure to different types of transactions and allows them to provide timely and relevant market intelligence, delivering significant, tangible value to their clients.