Investment Banking Case Summaries

Monticello Capital delivers results and serves its clients with professionalism, respect, and discretion. To that end, we offer summary descriptions of work performed.

Corporate Finance: Advisory Services

One of the world’s largest investment banks retained Monticello Capital as its “arms length” financial advisor to advise equity arbitrage during industry consolidation. The merger itself, joining giants in the industry, was international front-page business news. Monticello Capital’s role was to maximize upside gain for the international bank -- where unique industry-specific knowledge, the ability to keep an unbroken confidence from media and Wall Street analysts, and Monticello Capital’s proximity to Washington DC’s federal technology service sector all factored into the client’s success.

Corporate Finance: Transactional Services

Monticello Capital was retained by a private equity fund -- one of the most prominent and successful asset-management financial services corporations in the US. The transaction was the fund’s set-up of a new service enterprise for several young entrepreneurs with industry-unique knowledge. Monticello Capital’s role was to structure and value multiple interconnected classes of preferred and common equity in fairness to the entrepreneurs during a deal of high sophistication and complexity. The client realized that success in the out-years of the investment would require the difficult financial work to be completed early by Monticello Capital, a trusted outside firm. This was a sound judgment on the part of the client, because both the entrepreneurs and their financing partners later enjoyed phenomenal operational success and an extraordinary return exit event.

M&A: Divestiture

The client, a multinational conglomerate and the largest firm in its industry, came about as the result of its own series of mergers and consolidations. One of the subsidiary corporations involved in the industry consolidation was a business development client of Monticello Capital. As a result of the industry consolidation, this investment bank was retained to divest a technology-specific division. Monticello Capital represented the multinational on the sell side, locating the buyer, a smaller technology company. The sale closed for a combination of cash and equity. As compensation and commitment to the deal, Monticello Capital took a position in the sale, recommending its own “buy and hold” strategy to the seller, which also received equity in the technology company. At the end of the month in which Monticello Capital harvested its equity, the net internal rate of return actually realized was in excess of 470 percent.



M&A: Acquisition

Monticello Capital’s development-stage client sought growth through acquisition. The acquisition target was a failed dot-com with significant fixed assets: computers, information technology equipment, and a long-term office leasehold. The acquired firm had essentially squandered its start-up capital on technology infrastructure significantly exceeding its needs and its second round private equity capital on brand equity identification and name recognition. Monticello Capital acquired the dot-com for its client using the buyer’s common equity only. The client doubled revenues within two years of the acquisition and integration.

M&A: Leveraged Buyout

The buyer came from one of Monticello Capital’s corporate clients, a US-based international private equity fund. The qualified and sophisticated American investor was under age 40 and building significant personal net worth. Monticello Capital acquired an advanced-technology manufacturer for him using a leveraged buyout, the investor’s cash, and an inventive seller’s note that retired years before the seller’s expectations upon a subsequent re-leveraging by Monticello Capital. Through continued association with this investment bank, the buyer became the sole owner of the manufacturer, whose revenues and profits increased dramatically with the executive efficiency of new ownership and a geographic move of the plant.

Joint Venture

The client, an advanced technology firm unique in its industry, began as a corporate finance client of Monticello Capital. Through an expanding series of affiliations arranged by the investment bank, the client’s revenues increased eleven-fold during multiple engagements. Smooth transitions, adequate financing, and rapid reaction to a changing market were critical factors. Structuring each joint venture as an investment banking deal, Monticello Capital advised where straight sales were most advantageous, and where joint venturing was in the client’s best interest. The presence of the investment bank conferred a distinct market advantage during the firm’s accelerative growth years.

International Investment Banking

Monticello Capital’s client, a multinational holding corporation active in advanced technology industries, retained the investment bank to conduct a search, and to negotiate the transaction, of its purchase of a US corporation. Through an interactive process with the client’s executive management, a series of discrete and clear parameters for investment was developed. The qualification of the acquisition was conducted by Monticello Capital prior to identifying the buyer by name -- because exposure of a multinational corporate client at an early stage, before the seller’s reservation price is discerned by the investment bankers, usually results in a higher purchase price than the buyer should pay. Monticello Capital minimized the purchase price.

Restoration of Corporate Integrity

The client, an international financial services firm and a well-known name on Wall Street for a century, experienced organizational and leadership difficulties following the turmoil of the 1990s and a round of major acquisitions. Monticello Capital was engaged to advise the audit committee chairman and the chairman of the board in three areas: effective corporate governance oversight, necessary structural and personnel changes among the senior executives, and cost organization of the firm for effective compliance. A division divestiture resulted, with executive personnel changes, the discovery of correctible wrongdoing, and an eventual successful restructuring of the holding company.

Corporate Board Advisory Services

The client, a regional firm in a highly specialized technology sector, was concluding a phenomenal development stage. The company was in the midst of several simultaneous transitions. The original partnership had created a board that was much larger than necessary and its size was impeding its ability to make timely decisions. The board, although quite successful, was particularly young and inexperienced. New financing was required to fund the company’s explosive growth. Monticello Capital advised the complete restructuring of the board and management. From the investment bank’s own network, the client was introduced to two very experienced corporate directors with national reputations -- one was a CEO in the client’s industry who had taken his own company public; the other was the founder and CEO of a private firm in the client’s industry who had just sold his company to a multinational corporation. A significant new debt financing, also advised by Monticello Capital, resulted.

Not-for-Profits

A major national not-for-profit corporation was in some disarray upon the untimely death of its founder, a charismatic figure and leading light in the field. Monticello Capital’s client was an outside affiliate of the not-for-profit, requiring certain corporate financial and dealmaking assistance to develop a series of project-based transactions. This investment banking work, including a joint venture, brought the not-for-profit corporation’s major project to a successful completion, including new financing.