Investment Banks, Hedge Funds, and Private Equity

by David P. Stowell, Paul Stowell

Overview

Investment Banks, Hedge Funds, and Private Equity, Fourth Edition provides a real-world view of this fast-evolving field, reviewing and analyzing recent innovations and developments. This reference captures the actual work of bankers and professional investors, providing readers with templates for real transactions and insight on how investment banks, hedge funds, and private equity firms provide services to each other while creating opportunities for corporations and investors to raise capital, invest, hedge, finance, acquire, divest, and risk manage. For each type of institution, the business model, organizational structure, products, challenges, regulatory issues, and profit-making opportunities are explained.

In addition, specific transactions are analyzed to make clear how advisory services, financings, investments, and trades produce profits or losses, and which types of risks are most commonly taken by each type of institution. Importantly, the linkage of investment banks, hedge funds, and private equity to corporations, governments, and individuals is described, enabling the reader to more clearly understand how these organizations impact them and how their products and services can be best utilized.

Product Details

ISBN-13:	9780323884518
Publisher:	Elsevier Science
Publication date:	08/03/2023
Edition description:	4th ed.
Pages:	784
Product dimensions:	7.50(w) x 9.25(h) x (d)

About the Author

David P. Stowell is a professor of finance at Northwestern University’s Kellogg School of Management, where he teaches classes that focus on investment banking, hedge funds, private equity and venture capital. He also teaches undergraduate courses on these topics at Northwestern University. Prior to joining Northwestern in 2005, he was managing director at JP Morgan, working in Chicago with responsibility for part of the firm's mid-west investment banking business. In addition, he worked in investment banking at UBS as managing director and co-head of U.S. equity capital markets, and at Goldman Sachs, where he co-managed an equity derivatives business and worked in corporate finance in New York and Tokyo. He was also a managing director at O'Connor Partners, a hedge fund based in Chicago. He graduated from Utah State University with a BA in Economics and from Columbia University's Graduate School of Business with an MBA in Finance. In addition to his current teaching responsibilities, he manages Paradigm Partners, a boutique firm that provides M&A and capital raising services and general advice regarding investment banking, hedge fund, and private equity activities to selected clients.

Paul Stowell is a managing director and head of the U.S. Strategic Equity Transactions Group at Jefferies LLC. He has previously been managing director at Deutsche Bank, originating, structuring and executing convertible financings, corporate equity derivatives and margin loans on concentrated equity stakes. Earlier in his career he worked at UBS as an exotic equity derivatives trader and subsequently as a convertible bond trader. He designed and led auctions to facilitate the largest-ever sales of warrants for cash, raising over $7 billion in total including $1.8 billion in the largest offering. He has designed and sold unique equity-linked securities to help companies raise capital for special circumstances. He has helped many companies repurchase stock in a thoughtful manner, and worked with large shareholders on hedging and structured monetization transactions. As an adjunct instructor, he has taught semester-long courses on Investment Banking and on Hedge Funds & Private Equity at universities including the University of Utah, and has also been a guest lecturer at multiple universities on sales & trading and other topics. Paul graduated from Yale University with a BA in Economics.

Table of Contents

Part I 1. Overview of Investment Banking 2. Regulation of the Securities Industry 3. Financings 4. Mergers and Acquisitions 5. Trading 6. Asset Management, Wealth Management and Research 7. Exchanges, Clearing and Settlement and Credit Rating Agencies 8. International Banking 9. Convertible Securities and Innovation 10. Investment Banking Careers, Opportunities and Issues

Part II 11. Overview of Hedge Funds 12. Hedge Fund Investment Strategies 13. Shareholder Activism and Impact on Corporations 14. Risk, Regulation and Organizational Structure 15. Hedge Fund Performance and Issues 16. Overview of Private Equity 17. LBO Financial Model 18. Private Equity Impact on Corporations 19. Organization, Compensation, Regulation and Limited Partners 20. Private Equity Issues and Opportunities 21. Private Equity in China

Cases 1. Investment Banking in 2008 (A): Rise and Fall of the Bear 2. Investment Banking in 2008 (B): A Brave New World 3. Freeport-McMoran: Financing an Acquisition 4. The Best Deal Gillette Could Get?: Procter & Gamble’s Acquisition of Gillette 5. A Tale of Two Hedge Funds: Magnetar and Peloton 6. Kmart, Sears and ESL: How a Hedge Fund Became One of the World’s Largest Retailers 7. McDonald’s, Wendy’s and Hedge Funds-Hamburger Hedging?: Hedge Fund Activisim 8. Porsche, Volkswagen and CSX: Cars, Trains and Derivatives 9. The Toys "R" Us LBO 10. Cerberus and the U.S. Auto Industry 11. H.J. Heinz M&A Transaction 12. Quintilles IPO Transaction 13. New Case on M&A Transaction Litigation

What People are Saying About This

From the Publisher

Illuminates the post-2009 reinvention and acclimation processes

Editorial Reviews

"A comprehensive introduction to Investment Banking and Private Equity. Loaded with intricate details, it contains a unique frame of reference on best practices on both subjects. The book defines diverse concepts in clear and concise terms, and readers will benefit from valuable insights and expertise to vet opportunities that meet risk and reward objectives." —Viney Sawhney, Boston National Capital Partners and Harvard University

"It is the best on the subject that I have found, and I have been teaching for fifteen years. As long as Professor Stowell keeps it current it will be a valuable source of information on these three topics." —Charles Murphy, New York University

"In the first edition David Stowell gave students and accessible way to develop a deep understanding of financial firms. The new version smoothly and successfully integrates the lessons from the financial crisis and how the industry has evolved." —Jonathan Brogaard, University of Washington

"Books on investment banking are few and far between and mostly out of date. Usually they are very academic or written by lawyers rather than by someone who understands the business. This one, written by a former practitioner, gives students of investment banking just the insights they need into the nexus of investment banking, private equity and hedge funds." —Brian Scott-Quinn, Chair in Investment Banking, ICMA Centre, Henley Business School, University of Reading

"Investment banking is in permanent change. This new book on investment banking describes the most recent trends that have taken place in the industry, in particular the interaction between investment banking and the hedge funds and private equity businesses. This is an exhaustive and up-to-date guide to the major banking activities. The different themes covered in the book are illustrated by fascinating real life cases. The book by David Stowell will become the new reference on investment banking." —Pierre Hillion, INSEAD

"A clearly written account of several popular segments of the global financial services industry. Students who wish to enhance their understanding of the banking system would benefit from reading this book." —Sanjay Gupta, Swiss Finance Academy

From the Publisher