Business transactions are always transpiring, with companies buying, selling and merging. Naturally, all this activity requires professionals to add their expertise to help move the process along and keep things on time and under budget. In the world of mergers and acquisitions (M&As), one of the key players is the M&A analyst. Here, we’ll explain what an M&A analyst does, along with the buy-side vs. sell-side of M&As, but first a bit of background on the entire M&A universe.

Understanding Why M&A Deals Happen

M&As entail legal and financial transactions when two companies merge, or when one company acquires another. Similar to other types of business deals, there are multiple types of M&As, including acquisitions of assets, each of which has its own unique set of nuances.

There are many reasons why companies would partake in a merger or acquisition, which include increasing market share, reducing competition, gaining instant traction in a new market or perhaps acquiring existing intellectual property (IP), but the endgame is always to grow value. So, in short, M&A is a process, in basic terms, that results when two companies combine with one another.

The Analyst in the M&A Transaction

An M&A analyst is a member of the M&A team responsible for researching the market, analyzing trends, and presenting findings when it comes to the process of the M&A. The expertise of an M&A analyst lies in being able to identify notable details while researching the transaction, and good analysts are able to clearly and concisely present these findings to the stakeholders and decision makers of the deal. These findings also aid in the action plans for due diligence and other approaches taken during the course of the deal. The ability to analyze all parts of a business deal and effectively communicate those details to others is the main gist of the position. The roles and objectives of an M&A analyst include the following:

  • Research and prospecting
  • Analytics
  • Strategy
  • Collaboration

However, there are a couple of different types of M&A analysts: buy-side analysts and sell-side analysts. The differences are explained below.

Buy-Side M&A Analysts

As the name suggests, a buy-side M&A analyst works for the buyer in the deal. The duties of a buy-side M&A analyst include developing a list of potential target companies, instigating contact with those companies, and ultimately pitching an offer. In addition, there is always lots of due diligence to handle, closing the deal details to attend to, and finally, helping to manage the post-merger integration of the company that was bought or acquired.

Sell-Side M&A Analysts

As opposed to a buy-side M&A analyst who works for the buyer, the sell-side M&A analyst is employed by the seller, or the target company, the company that will be merged or purchased by the acquiring company. In addition to the due diligence duties that are mandatory for M&A analysts on both sides of the deal, a sell-side M&A analyst assesses the offer and the competition, and similar to its buy-side counterpart, has to have the ability to clearly and concisely communicate this information to others working on the transaction.

Key Differences Between Buy-Side vs. Sell-Side Analysts

As mentioned above, many of the tasks and skills for M&A analysts on both sides of the deal overlap; a knowledge of financial modeling, valuation techniques, core industry knowledge and an up-to-date grasp on the business and economic landscape are key attributes. However, there is more due diligence weight placed on the sell-side, mainly because it’s up to the analyst to get the best deal possible. Conversely, there is more pressure on the buy-side to be in touch with the numbers as well as the details of the deal, and how it fits into the big picture of the industry as a whole.

M&A Transactions Need Virtual Data Rooms

Whether you’re on the buy-side or the sell-side of an M&A deal, there is no doubt that having a robust virtual data room (VDR) provider is one of the tools for success. A VDR is a secure online location where all participants can store and share the required documentation securely, yet it’s a location that is easily accessible to the appropriate parties. Using a VDR in any M&A transaction saves all parties both time and money and adds security to the entire business deal. A sophisticated VDR includes many high-end features, including high-level admin controls, document and version management, multiple layers of security and customer support available 24/7.

Where CapLinked Fits In

CapLinked, an industry-leading provider of VDRs, is your trusted partner when it comes to the M&A process. Its user-friendly interface and ability to work on virtually every type of computer or internet-connected device makes CapLinked the best choice for anyone in the M&A space. Start a free trial today of CapLinked’s VDR solution.

Chris Capelle is a technology expert, writer and instructor. For over 25 years, he has worked in the publishing, advertising and consumer products industries.


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