A banker friend tells me of one such recent case of tight purse strings. When it came to the bond deal, my friend had nothing but good things to say about the management. The issuer had real knowledge of market conditions, knew where the comparables were trading and was pretty realistic about expectations. On top of their understanding of the market, they were also willing to listen to the leads’ advice on executing the transaction.
All this was well and good. But when it came to basic expenses the issuer turned out to be a bit of a nightmare client.
So much so that my banker friend had to account for every little expense — from a coffee that he dared to have at a local Starbucks rather than the issuer’s cafeteria, to a sandwich he sneaked in between meetings. Everything had to be accounted for.
It got even worse when it came time to divvy up a dinner bill between the bankers and the issuer when out on the roadshow. Convention has it that the issuer pays. Not so this time. Instead the company’s management went through the bill item by item and made the bankers pay for their own food and drinks.
I couldn’t help but wonder about this tactic as it took being tightfisted to a whole new level. But I guess in times like these one has to keep a close watch over expenses. Let’s hope the fees more than made up for it.