Sell side mandate

On a sell side mandate the bank works for whoever is disposing of the asset, whether that is a founder selling a company, a group divesting a division or a sponsor exiting an investment. The work runs from preparation, through approaching a list of buyers, to running a staged process and negotiating the final agreement.

The core of the product is competition. A seller negotiating with a single buyer has one counterparty and no leverage. A seller running a structured process with several credible buyers has an auction, and the price difference between those two situations frequently exceeds the fee by a wide margin. Everything the adviser does about timetable, information and access is in service of keeping more than one bidder genuinely engaged.

A buy side mandate is the mirror image: identifying targets, valuing them, advising on how to approach and what to pay, and helping arrange financing. It is usually a smaller fee and much less process work, because the adviser is responding to somebody else's timetable rather than setting it.

One bank cannot act for both sides of the same transaction, so conflict checks run before a mandate is accepted. This is also part of why an adviser with no financing arm argues that it has fewer competing interests than a full service bank that might also want to fund the buyer.