The Covid-19 crisis is forcing banks to adapt. Some players, such as investment bankers, are relying on new assistants: drones. Numerous transactions have been concluded through their intermediary. They can remotely visit assets for sale and save on mergers & acquisitions. While these practices are set to continue, they also have their limits.
Goldman Sachs: $104 billion in advised deals
While French banks have been at the forefront of their customers' efforts to deal with the crisis, American banks remain at the top of the French M&A rankings for 2020. More specifically, Goldman Sachs takes first place in the Refinitiv ranking, with $104 billion worth of deals advised. The bank managed the three biggest deals of the year:
- the acquisition of telecoms and media group Altice Europe by Patrick Drahi (5.35 euros per share),
- the legal dispute between Suez and Veolia (22 billion),
- the takeover of Ingenico by French industry champion Worldline (10 billion).
In second place is JPMorgan, also positioned in the top two deals. While Morgan Stanley was in the lead in 2019, the firm now slips to 7th place, with almost half as many deals as Goldman Sachs. Citi is also downgraded, dropping from 2nd to 11th place in this ranking, behind Crédit Agricole.
Pre-recorded video sessions by drone
The large number and volume of transactions managed by American firms can be explained by their ability to adapt in the face of the health crisis. In an interview with Les Echos newspaper, Anne Bizien and Jérémie Marrache, co-heads of Goldman Sachs' M & A in France, explain: "We had to adapt very quickly when we attacked the second quarter. For factory visits, we deployed several formats, such as video sessions pre-recorded by drone".
Goldman Sachs bankers believe that drones have helped to facilitate interactions with management teams and enhance the confidentiality of deals. These new methods have also led to cost savings, estimated at over half a million euros. Despite their advantages, however, drones are still a source of concern for some customers. These relate mainly to surveillance and data phishing. In addition, trusted third parties have had to intervene in several transactions to enable buyers to take augmented reality tours.
For their part, bankers admit that the virtual mode is not sufficient in the decision-making process. Indeed, face-to-face contact remains indispensable. " We'll try to keep the best of it, but body language and face-to-face contact remain crucial in the final phase," confirms Carsten Woehrn, head of funds for the Europe, Middle East and Africa (EMEA) region at JP Morgan.