Battle for Dominance in the M&A Advisory Business
Bulge-brackets vs. the boutiques
Wall Street, like Washington and football coaches, seems to have a special fondness for battle metaphors. Executives read “The Art of War,” headlines speak of “corporate raiders,” and the language of combat and victory pervades analysis of competitive trends.
Amid the noise and war whoops, it is possible that the true battles for industry dominance are being waged with little fanfare. One such battle is the ongoing contest between bulge-bracket investment banks and boutiques, played out on the fields of the mergers and acquisitions (M&A) advisory business. Boutiques have been a major competitive force since at least the 1990s and in recent years have further boosted both their share of the business and marketplace prominence. Still, a number of questions remain. How significant are boutiques’ gains? How have different factors driven boutiques’ achievements? Are these drivers sustainable and how severe is the threat to bulge-brackets?
This paper looks at the evolution of the competitive landscape in M&A advisory and examines the drivers of change. It also provides insights into the future of the competitive landscape and considerations for both boutiques and bulge-bracket banks.