M&A Advisory Fees Stay Level in 2022 Despite Economic Volatility

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Firmex Releases Annual Report on M&A Advisory Fees in Middle Market

Firmex, a global provider of virtual data rooms, announced the publication of their sixth annual North American M&A Fee Guide. This report is the authoritative source on M&A fees for sell-side engagements in the middle market and is utilized by both advisors and business owners as a reference point when determining fee pricing.

“With a record of over 500 M&A professionals who contributed to this year’s data, readers can expect a clear and accurate picture of what it has looked like to be on either side of a deal this year,” said Mark Wright, Firmex’s General Manager. “Just as it has been in the past, we anticipate this will be a valuable resource for advisors and business owners as they navigate the current economic climate.”

Firmex aims to produce a timely and useful resource on M&A advisory fees and how they’re charged. With a comparison against previous years, the guide provides a look into how advisors across North America structure compensation for a deal through areas such as engagement fees, success fees, and additional terms. Key highlights in this year’s report include the following.

  • Most firms kept their M&A fees level from 2021 to 2022 for deals of similar size and complexity.
  • More than half of advisors expect their revenue from M&A fees to be higher in 2022 than in 2021.
  • Most firms said their 2022 profitability was comparable to 2021.. Of those that did not have comparable profitability, more saw an increase than a decrease.
  • The number of firms that don’t charge a retainer or work fee in addition to a success fee increased to 19%.
  • Three-quarters of firms said there was no change in the pressure to cut fees in 2022, and only 12% of firms said the pressure increased.

Firmex surveyed 523 middle market dealmakers working in nearly 200 cities to develop this year’s fee guide. The key points drawn from the surveys are combined with expert commentary from Alfredo Garcia, Director & Head of Sell-Side at Axial and John Carvalho, President of Divestopedia.

Click here to access Firmex’s 2022 M&A Fee Guide.

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Edward Stephen
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