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Happy Sunday, future bankers!

Hope everyone is doing well! Today we’re covering who can pay the most in an M&A deal, a decision you’ve made that you would change, and Abu Dhabi’s goal to be the next New York City.

🚀 Let’s get into it.

🔢 Technical Question

Who can usually pay more in an acquisition, a private equity firm or a strategic?

In the context of investment banking, a strategic buyer can usually pay more in an acquisition compared to a private equity firm. Here’s why:

1. Synergies: Strategic buyers, often operating in the same or an adjacent market as the target, can benefit from synergies post-transaction. These synergies can be in the form of cost savings or incremental revenue, which can justify higher purchase price premiums.

2. Economies of Scale: A strategic buyer can realize economies of scale almost instantly due to integrated operations.

3. Accretive Acquisition: An acquisition needs to be accretive to the purchaser’s earnings. Strategic buyers can afford to offer a higher control premium given the potential synergies.

Therefore, while both strategic and financial buyers can pay substantial sums for companies, a strategic buyer generally pays more.

🗣 Behavioral Question

If given the opportunity, what’s a decision that you’ve made that you would change? Why?

Consider the following best practices:

1. Choose a Real Example: Select a genuine decision you regret - it adds authenticity. Avoid trivial or unrelated personal stories. The example should ideally be professional and relevant to the role you’re applying for.

2. Focus on Learning: Frame the situation in a way that highlights what you learned from the experience. The goal is to demonstrate personal growth and self-awareness, key traits that employers look for.

3. Show Responsibility: Take full responsibility for your decision, avoid blaming others. This shows your integrity and ability to accept mistakes.

4. Describe the Change: Clearly articulate what you would do differently if faced with the same situation again. This shows your problem-solving skills and ability to learn from mistakes.

5. Keep it Positive: End on a positive note. Emphasize how the experience helped you grow and made you a better professional.

🗞 Industry News

🏙 Abu Dhabi Looks to be the Next New York City

Abu Dhabi is pulling out all the stops to climb the ranks of the world’s biggest financial centers. Officials are offering a package of perks, from helping traders secure school admissions for their kids to assisting with country club memberships. The city’s $1.5 trillion sovereign wealth capital continues to attract hedge fund managers, but officials are also formalizing a program offering lifestyle support and visas. The hope is that these incentives, coupled with tax-free status, sunny weather, and a time zone that allows trading across Asian, European, and US hours, will continue to draw finance professionals from global hubs like New York, London, Hong Kong, and Singapore.

The city’s efforts are already bearing fruit, with several asset managers now managing more money from Abu Dhabi than anywhere else in the world. Global financial firms like Goldman Sachs, Rothschild, and Morgan Stanley are setting up offices in the city. Meanwhile, neighboring Dubai, long considered the Middle East’s business and finance hub, is also attracting hedge funds through similar incentives. However, Dubai’s success has led to long waiting lists for schools and social clubs, and traffic congestion. In contrast, Abu Dhabi’s streets and malls are less busy, and city officials are seizing this moment to offer a fresh package of lifestyle perks to attract more financiers.

Read more about this story below.

Thanks for tuning in today! Best of luck to everyone working through recruiting right now. If you sign an offer, reply to this email and let us know about it! Like seriously, do it—we’d love to hear about it!