CNBC: Goldman, J.P. Morgan using drones for M&A reconnaissance

Goldman Sachs is among investment banks using drone technology to give its clients a bird’s-eye view of the companies they are bidding on, according to Stephan Feldgoise, the firm’s global co-head of mergers and acquisitions.

After Covid-19 made the prospect of hosting in-person visits with groups of bidders unsafe, commercial-grade drones have been used to conduct virtual tours of everything from shipping ports and railroads to chemical factories, warehouses and big-box retail locations.

“We have been selling asset-based businesses all over the world using drones for site visits and fly-overs,” Feldgoise said in a phone interview with CNBC. “It gives buyers the confidence they need because when you are buying a business, you want to see, touch and feel what you are buying.”

It’s the latest example of how the pandemic has forced change onto what had been one of the most old-school, technologically-resistant corners of Wall Street. Of the several hundred transactions that Goldman has advised on during the pandemic, more than 95% were done without any face-to-face interaction, said Feldgoise.

J.P. Morgan is another firm that has leaned on drone technology in deals, according to a person with knowledge of the bank’s processes. Even boutique investment banks have been using them. When middle-market advisor TKO Miller helped SPI Lighting, a maker of architectural lighting fixtures, sell itself to a competitor, it made a two-minute sizzle reel that began with an aerial view of the 130,000 square foot headquarters, gliding across the firm’s factory floor and warehouse.

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