M&A is one of the most important events in the history of companies. It takes up a lot of resources, both spiritual and material. In the financial industry, there is a whole separate team dedicated to working on M&A. It includes analysts, employees, and a director. Being an analyst is the aspiration of many because it is not only interesting but also a well-paid job. In this article, we’ll break down how much do M&A analysts make and what responsibilities await them.
What is the average salary for M&A analysts?
M&A is a frequent process in the modern world, nevertheless, good specialists are always in demand. The average salary of M&A analysts across the United States is about $80,000 per year. Depending on the field, this salary can range from $48,000 to $130,000. And if you’re thinking about turning your career in this direction, you also need to learn more about the nature of the profession, its responsibilities, and skills.
M&A roles and responsibilities of Analysts
M&A analysts come in two types. The first one must present the selling company to their potential clients, while the second one is in charge of finding worthy partners with good performance. It is also the responsibility of the analyst to:
- Targeting companies
Analysts must generate a list of potential target companies based on detailed analysis. These companies can be searched through a variety of sources, such as a database, primary or secondary research, recommendations, advertising, corporate events, etc. Here your choice is not limited, the main thing is to provide worthy options for cooperation.
- Competition Assessment
To make a correct and detailed evaluation, the analyst should collect a lot of information about worthy organizations, perform a SWOT – analysis and investigate the competitive environment in a certain area (which is defined beforehand).
- Interaction
The analyst is responsible for making initial contact with pre-selected businesses. He organizes meetings, talking to the heads of the potential partners.
- Comprehensive verification
This is the main and most important task of the M&A Analyst. It is conducted to assess the viability of the transaction and the potential benefits of the collaboration. During this review, analysts analyze the financial, legal, and operational risks of the company.
The skillset of M&A analysts
The M&A analyst profession is a narrow, niche specialty for which a set of skills such as:
- Financial modeling
To determine potential and compatibility with a company, analysts must be able to study and work with an organization’s financial performance, forecasting its future development and identifying possible risks and benefits.
Once the transaction is completed and the company is integrated, the analyst should also conduct M&A simulations. Thus, he evaluates the value of already merged companies in comparison with other organizations. To do so, the professional would need to be able to make accurate assumptions, taking into account the market situation and the company’s internal situation.
- Knowledge of business valuation methods
During due diligence, the analyst should also be able to make business valuations. To do this, he must select and apply a valuation method that is appropriate for the company. He must be attentive to detail and be fair in his judgment.
- Creating accurate presentation books
Deal books are needed to provide their potential partners with a brief overview of the purpose and offer of the deal, but this usually contains a lot of information. Analysts need to format this information correctly and unobtrusively, making it easy to read and accessible.
In addition, analysts should have accounting skills, have impeccable basic knowledge of their industry, knowledge of how the global economy works, and corporate law.