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M&A consulting thrives when deal activity thrives. Although 2022 saw global dealmaking topping off at $3.63 trillion - a notable drop-off from 2021, which was a bumper year for M&A transactions - this figure on its own gives a snapshot into the scale of the M&A consulting industry, and the returns on offer for those that can source deals.
For a complete M&A solution, visit the M&A Science consulting suite. For now however, let's dive into the best consulting firms in 2023.
M&A consulting refers to the activities all of the M&A advisory firms, a term which covers anything from small brokerage firms to blue chip investment banks, and everything in between.
The idea between M&A consulting is the same as most consulting, be that strategy or any other corporate issue that a firm is looking to resolve - by hiring outside specialist advice for a transaction, the company, in theory, maximizes its chances of achieving value from a transaction.
The question ‘what makes a top M&A consulting firm’ is a more nuanced one than it appears. At first glance, you might think the answer to be good dealmakers, industry knowledge, skilled quantitative analysts, and expert negotiators. Prestige is also good, as it tends to attract a higher caliber of client, right?
Well, all of these are true to some regard, and looking at the best performers in M&A consulting, they all tick these boxes to a greater or lesser degree.
Our belief is that a top M&A consulting firm generates value for a client. That’s an uncontroversial statement in itself, but it warrants more explanation. M&A transactions are the bread and butter of M&A consultants.
If the CEO of a company asks an M&A consultant whether she should acquire a company, what’s the consultant going to say? The answer is unlikely to be: “you'd be better growing organically.”
Allowing for a certain lack of impartiality, M&A consultants can still add value. There’s nearly always value in good dealmaking.
But therein lies the value of what makes a top M&A consultant: The integrity to only work on value generating deals; the ability to say to a client:
“Do not close this deal [even though we stand to lose a fortune in fees].Your shareholders are not going to like it, and you’ll end up destroying value in the long-run.”
In short, a top M&A consulting firm doesn’t just close deals: It generates value for clients through its dealmaking ability.
Following is a list of top M&A consulting firms.
Investment banks are usually considered to be at the top of the pile in M&A consulting, and with good reason. In addition to generation the most fees of any M&A consulting firms, they offer additional, complementary services that often go hand in hand with M&A transactions. These include underwriting and IPOs and assistance in raising debt and equity finance. The biggest of these firms need little introduction:
Advisor to successive US governments and the largest corporations in the world, Goldman Sachs was once the outsider on Wall Street to the likes of Solomon Brothers and Lehman Brothers. Although its investment banking fees have recently taking a plunge, it remains a giant on Wall Street.
For over a decade now, JP Morgan’s Jamie Dimon has been one of the most outspoken people in the world of investments. When Dimon speaks, markets listen. This may have been one of the factors that saw JP Morgan climb to the top of the investment banking fees list. Recently made moves into asset management.
If the names of Morgan Stanley and JP Morgan appear similar, it’s because Morgan Stanley was founded by JP Morgan’s grandfather in 1935. Although the firm has recently been hit hard by the ongoing ‘deal draught’, it has gained a reputation as one of the toughest banks on Wall Street, notably being home to the notorious CEO John “Mac the Knife” Mack until relatively recently.
Citi (or more formally, “Citigroup”) is a large American investment bank that essentially came into being through consolidation, enabling it to show clients the proof of its competence in the area. Over the years, it merged with or acquired some of the biggest names in banking include Travellers, Smith Barney, and even Salomon Brothers, at one time the most prestigious investment bank in the United States.
Some of the world’s largest investment banks began life as boutique M&A advisory firms - smallish companies whose focus tends to be M&A, before branching out into other service areas as clients demand them (or as acquisitions to acquire complementary service companies become available).
Although the names aren’t as well known as the blue-chip investment banks, a selection of these companies advise Fortune 100 companies.
In the middle of the 19th century, three brothers, founded Lazard Frères & Co. as a dry goods merchant store in New Orleans, Louisiana.
As they moved in their different directions, the bank they founded began opening offices in each new city - not unlike the Rothschilds. Today, Lazard remains arguably the most well-known of all the so-called boutique investment banks.
Centerview is widely regarded as the best investment bank to work for, having recently won the Vault award for two successive years.
This reputation has been won on paying higher salaries to all of its bankers, which in turn makes it attractive to the best in the market. As a bank only founded in 2006, Centerview Partners has made remarkable progress in less than two decades.
If the name Guggenheim Partners appears familiar, it may be because the bank was started by the eponymous billionaire family at the end of the 1990s. Since then, it has become one of the world’s most recognized investment banks, largely thanks to its charismatic boss and media darling, Scott Minerd, who sadly passed away at the beginning of 2023.
Cantor Fitzgerland began operations in the middle of the 20th century and quickly gound out a niche working with middle market firms - where there are far more transactions to advise on than (and at that time at least, less fierce competition among investment banks) at the higher level.
Its CEO, Howard Lutnick, has been at the helm for a remarkable 32 years.
M&A is an integral part of corporate strategy - arguably the part that has the potential to go most wrong - so it follows that strategy consultants should advise on whether corporations should add an inorganic growth strategy to their organic growth strategy. Furthermore, with the corporate world having reached a consensus on the importance of post-merger integration, strategy consulting houses have tended to be the big winners of the M&A consulting business involved.
Despite a raft of scandals and controversies, McKinsey is unquestionably the most prestigious strategy consultant in the world, advising all of the world’s largest governments, companies, and organizations. McKinsey fiercely guards its clients’ details, which enables it to play the role of M&A advisor in deals, where the counterparty could be a previous client.
Although smaller than McKinsey, the company founded by Bruce Henderson at the beginning of the 20th century is often regarded as its equal. Its contribution to management thinking can be seen in tools such as the BCG (‘growth share’) matrix, used by companies and academics since its inception in 1970. Currently has offices in over 100 cities across 50 countries.
Bain and Co. may be the least well-known of the ‘big three’ consulting firms, but it has gained a strong niche in M&A advisory, advising some of the largest players in the private equity industry on their portfolios and portfolio additions. The firm also has gained a niche among the large consulting firms as the one that creates strategies for non-profits and NGOs. 2021 revenue was $5.8 billion;
Accenture is the most acquisitive of the large consulting firms, regularly acquiring dozens of smaller people (services) companies every year across its global offices. This gives it a certain expertise in M&A consulting that may come as a surprise to some. Headquartered in Dublin, the company began as the consulting division of notorious accounting firm Arthur Andersen.
The ‘big four’ accounting firms (the first four names on the list below) are synonymous with M&A consulting, as well as auditing and tax. Scandals and conflicts of interests over the past couple of years (who does a company provide consulting to a client and simultaneously remain impartial when conducting an audit for the same client?), appear to have been the spur for many of these accounting firms to split into their different components.
Based in London in the United Kingdom, PWC, like many companies on this list, is the product of several mergers and acquisitions. The most famous of these came in 1998, when auditing firms Coopers & Lybrand and Waterhouse Coopers merged, to bring both companies under one roof. 2022 revenues exceeded a remarkable $50 billion, and show no sign of decreasing.
KPMG was founded at the end of the 19th century in New York by two Scottish immigrants. Then known as Marwick, Mitchell, and Co., the young accounting firm was able to cash in on what was then the world’s fastest growing environment for banking. The company has faced a series of controversies in the 21st century, notably around the time of the global financial crash (GFC).
Deloitte was founded in the middle of the 19th century in London and has since grown to a global giant of nearly 300,000 professionals spread across 150 countries. It roots in M&A go back to the 1950s when it established its dedicated management consulting practice, now one of the largest in the world, and among the most successful where M&A transaction fees are concerned.
It will come as little surprise that EY (Ernst and Young) is the result of several M&A transactions made over the course of 170 years, the most recent of which was 34 years ago when Ernst & Whinney merged with Arthur Young & Co. In terms of volume of deals, EY currently ranks fifth of all M&A deals, having ground out a niche for itself in transactions involving biopharma and life science companies.
The rate at which many of the companies on this list have grown their deals by size and volume is in large part due to their leveraging the best available technology.
Research by consulting firm Accenture indicates that 74% of CEOs see tech integration in M&A as a growth enabler or source of competitive advantage, and that 96% of CIOs have seen tech due diligence uncover issues or opportunities that made a material deal impact.
Turned on their head, these findings suggest that companies who don’t use technology are i) not going to unearth growth-enabling opportunities, and ii) are not going to uncover the issues that destroy value in deals.
The bigger and more complex the deals, the higher the value that technology has the potential to generate. This is the reason that firms now routinely use sophisticated VDR tools to maximize their M&A transaction outcomes.
FirmRoom has been witness to, and a catalyst in this M&A technology revolution
Besides providing high-end investment banks and consulting firms with state-of-the-art virtual data room/M&A lifecycle software (FirmRoom and DealRoom), it now leverages its experiences with these companies to provide clients with its own consulting practice, led by renowned M&A expert, Kison Patel, author of the best-selling book, Agile M&A.
There are approximately 4,000 investment banks in the United States, ranging from small individual brokers to Wall Street investment banks.
In 2022, the US investment banking industry was worth an estimated $188 billion.
Investment banks usually charge a retainer fee and a percentage of the consideration paid, which varies depending on deal size, but rarely passes 10% of the transaction size.