Felix Salmon

Investment banking fee datapoint of the day

By Felix Salmon
February 22, 2010

The outcome of this suit — if it’s ever made public — is going to be very interesting. JP Morgan advised Consolidated Minerals when it received a series of takeover offers: as the adviser to the target company, it was pretty much guaranteed a fee, no matter who ended up buying the company. The question is just how much of a fee it was going to get.

ConsMin reckons that it agreed to a cap of A$7 million on JP Morgan’s fees in a 2006 telephone call; JP Morgan, meanwhile, submitted an invoice for A$50.8 million, and claims that in fact it’s due as much as A$86.9 million for its 14 months’ work on the deal, thanks in part to racking up new fees every time a new bid appeared. I’m sure it’s happy it doesn’t have Jed Rakoff trying the case.

(Via McKibben)

2 comments so far | RSS Comments RSS

“Rack off” being a peculiarly Australian expression.

http://www.urbandictionary.com/define.ph p?term=Rack%20Off

Posted by gringcorp | Report as abusive

The graphic is very suggestive and doesn’t need any supplemental info. Believe the predictions are real in this case. We will see what the future will provide us.

Posted by rcaieftin | Report as abusive

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