UCLA Anderson

Investment Banking ACT Group

Session 1

10/1/2011
 IB Recruiting Timeline
November 4th - December 13th: Company Presentations


 Companies will be on campus with presentations followed by networking events

October 18th: Resume due for Parker Resume Book
October 19th and 20th: Training the Street Valuation Workshop

 Overview of valuation methodologies

October 21st: Investment Banking Career Night
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 Recruiting process kicks off

November 14th and 15th: SF DOJ


 Visit banks in their San Francisco, Palo Alto, and Menlo Park offices
Date TBD: NYC DOJ


 Visit banks in their NYC offices

Winter Break:


 Study interview questions

January 2-3:


Career Preparation Week

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January 3:


 Training the Street Interview Prep

January 6th – 10th:
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 Mock Interviews
January 13th:
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 First round interviews begin

 IB Resources
Investment Banking Research and Valuation
Overview WSJ
 Mergers and Inquisitions Dealbook
 http://www.mergersandinquisitions.com/ http://dealbook.nytimes.com/

 Vault Career Guides The Deal Pipeline

 Parker CMC website Rosenfeld Library Database

 Wetfeet Career Guides Capital IQ

 Parker CMC website Rosenfeld Library Database

Investment Banking – Valuation, Investext (Thomson Reuters)

Rosenfeld Library Database
Leveraged Buyouts, and Mergers & PE Hub Wire
Acquisitions by Joshua Rosenbaum Free daily e-mail
http://www.pehub.com/pewire-signup/
and Joshua Pearl
ACT Dropbox

Please inform your ACT coaches if you do



not have access

Investment Banking
 What is Investment Banking
What is investment banking Investment Bank Structure
Investment banking, or I-banking, as it Corporate Finance (equity)
is often called, is the term used to Corporate Finance (debt)
describe the business of raising capital Mergers & Acquisitions (M&A)
for companies and advising them on Equity Capital Markets
financing and merger alternatives. Debt Capital Markets
Capital essentially means money. Equity Sales
Companies need cash in order to grow Fixed Income Sales
and expand their businesses; Syndicate (equity)
investment banks sell securities (debt Syndicate (debt)
and equity) to investors in order to Equity Trading
raise this cash. These securities can Fixed Income Trading
come in the form of stocks, bonds, or Equity Research
loans. Once issued, these securities Fixed Income Research
trade in the global financial markets.

Source: Vault Career Guide

 Investment Bank Structure

Traditional Investment Banking S&T Research

Capital Raising Distribution and execution arm Analysis and recommendations
of I bank of stocks and bonds
Debt Sells and trades stocks and Includes company Coverage and
bonds Sector Coverage
Equity Manages the firm’s risks and
makes markets for the securities
underwritten by the I bank.
Strategic Advisory
M&A
Takeover Defense
Restructuring
 Banking Functions
M&A
On the mergers and acquisitions (M&A)
advising side of corporate finance, bankers
assist in negotiating and structuring mergers
between companies. If, for example, a
company wants to buy another firm, then an
investment bank will help finalize the
purchase price, structure the deal, and
generally ensure a smooth transaction. In the
last few years, the M&A market has been
white-hot, as companies have large cash
balances with which they can complete
strategic transactions.
Source: Vault Career Guide
Underwriting
The underwriting function within corporate
finance involves the process of raising capital for
a company. In the investment banking world,
capital can be raised by selling either equity
(stocks) or debt (bonds or loans) (as well as
some more exotic securities) to investors.
Underwriting is unique, in that it involves
the investment bank assuming a large
amount of risk. Essentially, in the case of a
bond offering, you can think of the process of
underwriting as an investment bank writing
a check to a company, then raising the funds
in the markets from investors. This means
that the investment bank assumes the risk of
the transaction not selling in the market.
Think of this as buying pizza for friends and
relying on them to pay you back. If you’ve
ever done this, you’ve “underwritten” a
transaction.
 Product vs. Coverage Groups
Product Group
Product groups always work on a
specific deal type, such as M&A or
debt, across all different industries –
examples include:
Mergers & Acquisitions
Equity Capital Markets
Debt Capital Markets
Leveraged Finance
Restructuring
So if you’re in the M&A group, you’ll
always work on acquisitions of other
companies across all industries
Product groups get to know specific
transactional models – merger models
or LBO models – really well, but won’t
do much outside that and won’t learn
an industry in as much depth.
Source: Mergers and Inquisitions
Industry Groups
With industry groups, by contrast, you
work within one industry but on many
different types of deals – equity, debt,
M&A, and so on. Examples include:
Healthcare
Natural Resources (Oil & Gas and
Mining)
Technology, Media &
Telecommunications (TMT)
Financial Institutions Group (FIG)
Industrials
Industry groups focus more on
knowledge of the industry, what
different companies are doing, and
building operating models (3-statement
models) for companies.
 Product and Coverage Landscape
TMT Consumer/Ret. Financial Industrial Healthcare Financial Energy/Power Gaming
Sponsors Inst. Leisure
Group
M&A

Leveraged Finance

Restructuring

Equity Capital Markets

Debt Capital Markets

 Major Players that Recruit on Campus

Bulge Middle Market Boutique

Goldman Sachs RBC Lazard
Morgan Stanley Wells Fargo Moelis
Bank of America Merrill Lynch Houilhan Lokey Demeter Group
JP Morgan Jeffries
Deutsche Bank Piper Jaffrey
Credit Suisse
Barclays Capital
Citi
UBS
 Deal of the Week
Deal of the Week
3-5 minute overview of a recent deal

Buyer / Seller
Revenue, EBITDA, Market Cap

Deal Size

Payment Method / Deal Structure

Advising Banks

Deal Rationale

Market Reaction

Deal can be M&A, debt or equity offering, or other transaction

Please send your ACT coaches your deal research the night before

your assigned meeting

 For Next Week…
Continue working on 30-second pitch
Continue refining your resume for IB

Begin reading WSJ everyday

Sign up for WSJ Deal Alerts

Begin reading Vault Guide

Read following fit questions from 400 IBD Questions and begin

working through your answers. We will go through these next week

Why Banking?
Background / Personal

Walk me through your resume

Career switcher questions

Sign up for Deal of the Week before you leave

