What can you expect during your first year at Baird? First-year associates have the opportunity to work on a variety of transactions. Associates are typically exposed to a balanced mix of M&A transactions (sell-side and buy-side) for our corporate and private equity clients. Additionally, associates gain exposure to the capital raising process by playing an integral role on a deal team that helps a client raise funds through IPOs and follow-on offerings. A brief description of each type of transaction is provided below.
TYPICAL TRANSACTION EXPOSURE
M&A Sell-Side Advisory
As a sell-side advisor, Baird gains an extensive understanding of the client, its financial performance and its competitive position in the industry. A team of Baird investment bankers develops and communicates to management its thoughts on valuation in order to clearly set expectations. Through extensive due diligence (i.e. financial due diligence, operational analysis, facility visits, management interviews and industry analysis) the team assesses the appropriate marketing strategy and develops the appropriate list of potential acquirers or merger partners. Once the client approves the marketing strategy, the team begins the marketing process by drafting strategically written marketing materials. The team contacts potential acquirers through a highly tailored calling effort. The team and the client select a final list of potential acquirers based on preliminary bids. The team coordinates and supervises further due diligence opportunities for selected bidders (i.e. financial due diligence, meetings with management and facility tours). Once a final bidder is selected, Baird, the client and a team of legal advisors negotiate the most beneficial terms possible in a purchase agreement. Baird works diligently to efficiently close the transaction under the right terms so management can focus on running the company through the entire process.
An Associate's Perspective…
Being engaged to sell a private equity firm's portfolio company was an exciting transaction. The deal was important to the PE firm, company management and employees in addition to being a franchise-building transaction for Baird's financial sponsor coverage and direct marketing teams. Our mandate was to run a broad marketing process to identify the transaction that would balance maximizing existing shareholders' return on investment and ensuring the continued success of the company under its new owners.
The experience afforded me the chance to work closely with C-level management at the company we were selling, several senior partners at the private equity firm that owned the company and, of course, Baird's entire team. After winning the mandate in early fall, I spent many late nights drafting the marketing materials that we would use to solicit interest in the company. After many iterations of the Confidential Information Memorandum internally with the Baird deal team and externally with the client, we began contacting potential buyers. I personally made contact with many of the buyers, described the opportunity, answered questions throughout their review of the deal and ultimately coordinated onsite due diligence and management presentations. During this deal, I researched and helped our team understand many peculiarities of this particular transaction such as certain tax issues, environmental concerns and working capital concerns. Throughout the process I recognized that my efforts, like those of my teammates, were critically important to getting the deal done. At Baird the teams are staffed leanly so each person's individual efforts are impactful and important. Responsibility is heaped on in exciting and challenging amounts.
M&A Buy-Side Advisory
As a buy-side advisor, Baird assists a company through every step of the acquisition process. A team of Baird investment bankers perform due diligence on the potential acquisition target. The team gains an understanding of the value of the target through extensive financial modeling and analysis. The team assesses the target's competitive position within the industry and analyzes the strategic fit within the potential acquiring company. The team assesses the potential for other competitive bids in the process and analyzes the financial limitations of each potential bidder. Baird monitors the performance of the target throughout the process and continuously assesses the need for purchase price adjustments. If our client is selected as the final bidder, Baird helps the client obtain optimal financing and works with a team of legal advisors to negotiate the most beneficial terms possible in a purchase agreement. Baird works diligently to efficiently close the transaction under the right terms so management can focus on running the company through the entire process.
An Associate's Perspective…
I was very excited to have the opportunity to work on this transaction because I felt that it was not only an important strategic event for our Client, but also an important assignment for Baird. Just as this transaction made our Client a leader in Europe, this assignment also served to solidify Baird's position as a premier transatlantic middle-market investment bank.
This experience has provided me with the opportunity to work with a middle-market client and take on responsibilities that, I am certain I would not have had if the client were a Fortune 500 company. I worked directly, and sometimes solely, with the Company's M&A Manager and CFO. Additionally, I was given an enormous amount of responsibility, such as organizing portions of our team's European due diligence. Moreover, this transaction was very unique and complex. It was our client's first major acquisition in Europe and an important transaction for Baird's transatlantic M&A practice. The Seller had operations in almost every country (and currency) in Western Europe. As a result, I was exposed to complexities such as tax structuring, currency hedging, international valuation and business integration.
In short, my first-year associate experience at Baird has exceeded my expectations, both from a cultural and career development perspective.
EQUITY CAPITAL RAISING
Public Equity Offering
As a lead or co-manager of an IPO or a follow-on offering, Baird is responsible for helping a client raise capital in the form of equity. A team of Baird investment bankers performs extensive due diligence on the client's operations, financial projections, business plan, strategy and legal and environmental issues. The team is instrumental in drafting the offering prospectus / registration statement to be filed with the SEC. The team and the client collectively develop roadshow presentation materials for current and potential institutional investors. If Baird is the lead manager, members of the deal team accompany company management throughout the roadshow as the management team presents to institutional investors. After the roadshow, pricing is determined and final "bring down" due diligence occurs with all underwriters and the client's legal advisors. A final registration statement is filed with the SEC.
An Associate's Perspective…
As a first-year associate at Baird, I had the opportunity to take on as much responsibility as I wanted to expand and build my business skill set. For example, as an Associate working on a follow-on offering, it was my responsibility to attend drafting sessions and represent Baird's interests in the transaction. As part of the due diligence process, I interviewed senior-level management to gain a thorough understanding of the overall business, growth opportunities, financial stability and risks associated with the company. As the process continued, I participated in follow-up drafting sessions and worked with senior bankers on the teach-in materials used to present the opportunity to our institutional sales force. This is only one example of the many projects an associate has the opportunity to work on at Baird. Baird works hard to develop junior bankers by exposing them to various product types and management styles of senior-level bankers. Over the past year, I have been exposed to buy-side, sell-side, privatizations and corporate restructuring projects.
Private Placement of Equity
Baird helps its client raise capital through a private placement of equity with one or a number of institutional investors. As representatives for the client, a team of Baird investment bankers perform extensive due diligence on the client's operations, financial projections, business plan, strategy and legal and environmental issues. The team assesses the appropriate marketing strategy and develops a list of potential investors. Once the client approves the marketing strategy, the team works with the client to draft a Private Placement Memorandum for distribution to a strategically selected group of institutions. The team and the client collectively develop roadshow presentation materials. The banking team accompanies management throughout roadshow. The banking team receives and evaluates initial indications of interest. A final bidder is selected by the team and the client. The client and a team of legal advisors negotiate the most beneficial terms possible through a private placement term sheet. The client signs a definitive agreement, files the appropriate documents with the SEC.