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Looking for Mergers and Acquisitions Jobs? Stay focused on Middle Market
.If you have been following the news you noticed the recent migration of the highprofile bankers to the middle market investment banks. For example, a couple daysago Perella Weinber announced that it hired a former Morgan Stanley energyheavyweight Michael Dickman. The obvious reason is that the middle market is anoasis from the political assault and regulatory uncertainty that the bulge bracketinvestment banks face. There is one factor at play here: a middle market M&Arebound in the next several months. This article analyzes the reasons why a broadspectrum of analysts are predicting middle market M&A activity and predicts whatthis rebound means forMergers and Acquisitions Jobsl
andscape.The interest in middle market is not new. Even in the pre-TARP world investmentbankers have been increasingly focusing on the deals in the $100 to $1 billion range.In the mid-2007 Lazard acquired a middle market investment boutique GoldsmithAgio. Around the same time Ken Moelis, an investment banking legend, started amiddle market-oriented firm Moelis & Co. Also bulge brackets executives such asGoldman Sachs CEO Lloyd Blankfein intended to expand to middle market. This trendobviously came to halt as the financial crisis came about, not to mention thedevastating effect on investment banking careers and mergers and acquisitions jobsmarketplace.Th good news is that the 2009 Q4 showed a significant increase in middle marketM&A activity. This is not a coincidence or a one time spike: the sellers gotcomfortable with the valuations since, despite uncertainty, the financial marketshave stabilized. At the same time, the valuations are low enough that largecorporations have relatively large reserves of cash. Hence the acquisitions willbecome more and more tempting for the board of directors, especially given that theorganic growth in the current economic conditions will be mediocre. In addition,private equity firms after focusing on improving operations of the portfoliocompanies in 2009, will be attempting to exist some of their investments to returnthe money to the investors. Finally, large deals are still seen as to risky while themiddle market bets are palatable.
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