Investment banks don’t want to “set the price” at this stage of the process – they would rather let potential buyers place bids and see where they come in.įinally, a CIM is NOT a pitch book. Second, there is also nothing on valuation in the CIM. It is a marketing document intended to make a company look as shiny as possible.īankers apply copious makeup to companies, and they can make even the ugliest duckling look like a perfectly shaped swan.īut it’s up to you to go beneath the dress and see what it looks like without the makeup and the plastic surgery. What a Confidential Information Memorandum is NOTįirst and foremost, a CIM is NOT a legally binding contract. – and details on how the company plans to use the funding. The structure of a CIM varies by firm and group, but it usually contains these sections:ġ) Overview and Key Investment Highlightsĭebt-related CIMs will include the proposed terms – interest rates, interest rate floors, maturity, covenants, etc.

The Order and Contents of a Confidential Information Memorandum You might write a short memo for equity deals, but not an entire CIM. You can write CIMs for debt deals, as well as for distressed M&A and restructuring deals where your bank is advising the debtor. You start by sending the Teaser to potential buyers if someone expresses interest, you’ll have the firm sign an NDA, and then you’ll send more detailed information about your client, including the CIM. You turn this information into many documents, including a shorter, 5-10 page “Executive Summary” or “Teaser,” and then a more in-depth, 50+ page “Confidential Information Memorandum.” It’s also known as the Offering Memorandum (OM) and Information Memorandum (IM), among other names.Īt the beginning of any sell-side M&A process, you’ll gather information on your client (the company that has hired you to sell it), including its products and services, financials, and market. The Confidential Information Memorandum is part of the sell-side M&A process at investment banks. So here’s the full run-down, from how they are used in investment banking to private equity and beyond – along with a bunch of real-life CIMs: What is a CIM? There is surprisingly little information out there on what goes into a CIM, and there’s a lot of confusion over how you write one and how you read and interpret a CIM. Not necessarily, but they certainly help.īut you definitely need strong reading comprehension skills, or you’ll miss crucial information and make the wrong decisions as a result.īoth of these skills intersect in the confidential information memorandum (CIM) that investment banks prepare for clients – the same CIM that you’ll be spending a lot of time reading in private equity, corporate development, and other buy-side roles.

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