Fees can be a touchy topic. This is perhaps why there is a
paucity of publicly available data on mergers and acquisitions
(M&A) fees. However, with the recent
publication of the M&A Fee Guide 2017, we now know more about
fees relating to M&A than before. The guide consolidates survey
responses from over 470 advisors and investment bankers from around
the world. Listed below are some of the survey's key findings
and the corresponding implications.
The smaller the company, the larger the fee
One key finding of the survey was that companies with smaller
purchase prices had larger advisory fees. The Deal Room offered a strategy to combat these
larger advisory fees. They recommended that businesses should speak
with many advisors before settling on one, in order to determine
what different firms are charging. The survey also revealed that
the spectrum of success fees was quite large when the price of a
company was below $5 million.
