I joined IIM Trichy last year with a lot of hopes and an ambition to make a career in investment banking, especially in mergers and acquisitions. Being a part of the premier institute with great growth offered several memorable experiences. The one I am going to share is particularly memorable because it offered me to experience a dream of M&A consultant on my birthday. What more anyone can ask for!
As a part of MPPO (Managing People and Performance in Organisation) course and with help of Strategy & Consulting department, we had a classroom activity centred around the acquisition of European luxury automobile subsidiary of US-based automobile company by an Indian conglomerate. The class was divided into five groups of twelve students each. Each group had six parties with 2 students in each- sellers, buyers, labour representatives, consultants (from both buyer and seller sides) and observers. Every party had a different objective – Sellers had a minimum limit and expected amount; Buyers had expected price and maximum limit; Labour representatives wanted job security, better pension plans; Consultants had commissions depending on deal terms and Observers had to observe negotiations and record peculiar points. As a buy-side consultant, my objective was to make deal at minimum costs. We were given some documents about other company including financial statements, operational details, competitive scenario. We also had our own documents containing trade secrets, some undisclosed confidential information, etc.
Both consulting parties were trying to extract as much information about the other side in order to gain the bargaining power. There were several rounds of negotiations, some of them were just for gauging reactions and possibilities. We first negotiated with labour representatives separately by offering them higher performance-based pay instead of their proposed pension plan. This helped our team to strike a deal on favourable terms with near-bottom prices along with the access to cross- party licensing agreement in a platform sharing space. Then we had to make some minor changes in terms of the deal to get regulatory approval from professors.
First time in life I experienced such pressure, strategy requirements, the importance of information gathering and negotiation skills apart from synergy and other financial calculations. We shared our experiences with a McKinsey senior consultant a few days later and got to learn about his own experiences and insights. I think this experience has helped me develop a strategic perspective required for such critical profession. Hands-on experiences like these make life at IIM Trichy truly unique and special.
Which ABG company would you want to work for and why?
Aditya Birla Capital Limited always has been one of the top aspirations for me – not only because of my immense interest in finance but also company’s vast coverage across segments and growth over the years. As an investor, I always get impressed with the investing philosophy of management and top class performance of asset and wealth management companies. My passion, dedication and skills in finance will help me in achieving excellent results in ABCL. Considering competitive work culture and future business expansions, I believe ABCL will offer me great career growth opportunities.
This article is written by Jagtap Sachin Suresh - Class of 2019.