Zero M&A Experience, Mr. Osborne? You’re Hired

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Former U.K. Chancellor of the Exchequer George Osborne is starting a second career as a full-time M&A banker in his late 40s. His move to the boutique firm Robey Warshaw LLP with zero past corporate finance experience says a lot about what makes senior hires valuable in this industry.

Government officials regularly pop up in financial institutions in part-time roles, opening doors and dipping into situations on an ad hoc basis. Indeed, Osborne has been an adviser to BlackRock Inc. But the M&A move is all in. That’s not the only thing that sets it apart. Robey Warshaw has advised on some high-profile transactions but it remains a small, low-profile firm. This appointment puts it in the spotlight. While Osborne is nearly five years out of government, he remains a controversial figure, linked to the administration of former Prime Minister David Cameron that implemented painful austerity measures and triggered the U.K.’s withdrawal from the European Union.

That noise will quiet down over time. But for the transition to work, Osborne must deliver on two counts. First, he must expand the connections of a firm that has deliberately focused on being a U.K. specialist. Osborne’s past roles will have given him a network that should be highly valuable here, especially on the international stage. It’s not hard to see how they could help a boutique firm compete against the Wall Street behemoths for cross-border deal mandates involving U.K. companies, on either side of the transaction. If inbound M&A is going to pick up, that will count for a lot.

Then, as an adviser, Osborne will have to bring something to the boardroom discussion too. That’s despite being new to M&A. It’s not just that he has skipped the grueling training that graduate trainees endure. Compared to other potential hires of his age, he will lack the experience of having worked on past transactions, each one similar but different, each one bringing new lessons that in turn improve the quality of advice next time round.

Osborne does bring the unique experience of effectively being chief financial officer of an entire country with a lot of debt, plus a broader geopolitical perspective. Holding the purse strings on government while dealing with demands from high-spending departments surely taught him something about negotiation. And the most valuable skills of M&A advisers aren’t technical. They involve mastering a brief quickly, forming a view and delivering it with conviction and authority to reassure clients under pressure. Such skills are also a prerequisite of a political career. Robey Warshaw’s existing partners already have enough know-how gleaned from past transactions.

Still, if Osborne’s current network is what makes him most valuable today, these connections are likely to diminish over time. Ultimately clients want to win the deal, survive the hostile bid or sell their firms for a top price. For this career to stick, Osborne’s going to need to prove he can do more than open doors.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Chris Hughes is a Bloomberg Opinion columnist covering deals. He previously worked for Reuters Breakingviews, as well as the Financial Times and the Independent newspaper.

©2021 Bloomberg L.P.

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