Bulge Bracket

What Does Bulge Bracket Mean?

The bulge bracket is a term used to identify the top tier of investment banks that conduct the biggest and most lucrative assignments. They usually have a roster of large corporations, and they work on big ticket engagements such as capital raises and IPOs as well as provide significant financial consulting.

The term bulge bracket is in reference to the "tombstone," or marketing material, investment banks use to promote the closing of a transaction. When several banks work on a transaction, there is often one or two that manage the deal, with the rest taking a piece of it. The ones that manage the deal appear first and more prominently on the tombstone and are the ones that usually get included in the bulge bracket.

Divestopedia Explains Bulge Bracket

A bulge bracket, in the context of middle market M&A, doesn't really exist. The deals are of a size that seldom require more than one advisor. Similarly, middle market transactions are often more about local knowledge or industry expertise and less about having a big investment bank manage the transaction. Sellers are better served if they select M&A advisors based on their needs, level of service and ability to close transactions rather than picking out of some non-existing M&A bulge bracket just to have a big firm represent them.