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M&A Fee Guide 2018-2019

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New Research on M&A Advisory Fees

Ever wondered how other M&A advisory firms in your city or region are structuring their fees? The third annual M&A Fee Guide conducted by Firmex and Divestopedia has the answers. With data collected from over 480 investment bankers and advisors worldwide, this comprehensive report provides a global perspective on average fee structures, what is being charged and why.

Inside, you’ll find valuable data and insights including average M&A fees by region and major city, deal flow and minimum transaction value, success fee structures & fee percentage by deal size. Contributors from BDO and Dentons weigh in on the key findings in the report.

Key Findings in the Report:

The latest data shows that M&A success fees vary notably by region and major city centers. Given these significant regional differences, M&A advisors should ‘think locally’ when assessing their fees and not rely exclusively on national averages.

This year’s report digs deeper into engagement terms in M&A sell-side assignments. 55% of the respondents indicated that their success fee is paid in full on closing, regardless of when the components of the purchase price are received by the vendor.

66% of our respondents indicated that it is more common to include success fee amounts up-front in the engagement letter. The majority of respondents — 61% — said it was not common practice to include a break fee in the engagement letter.

M&A advisors were asked how they are reimbursed for expenses. Only half of respondents indicated that they charge their clients for out-of-pocket expenses; 23% said they are reimbursed for the cost of a data room. This suggests that advisors are increasingly inclined to view these costs as “value adds” or strategic investments.

This guide is becoming an increasingly valuable tool for business owners looking at a potential sale. Sale mandates are complicated and, as this research shows, the associated fees can be calculated in many different ways. Adam Mallon, Managing Director, Transaction Advisory Services, BDO Canada LLP

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About Firmex

Firmex is the most widely used virtual data room for supporting complex processes including due diligence, compliance and litigation. Our ease of use, simple pricing model, and outstanding 24/7/365 customer support have made Firmex the virtual data room of choice for M&A professionals worldwide including many of the leading mid-market investment banks and advisories. To book a demo, click here.