Content

1 Introduction 2
2 Dealogic | Performance Optimized 2
2.1 Mission 2
2.2 Vision 2
3 Important Business Concepts 2
3.1 What is an Investment Bank (IB)? 2
3.2 Structure of an Investment Bank 3
3.3 Processes of an Investment Bank 3
3.4 Investment Banking Domain Knowledge 4
3.4.1 Deals & Tranches 4
3.4.2 Tranche Based Information 4
3.4.3 Entities 5
3.4.4 Roles 5
3.4.5 Deal Value / Volume / Revenue / Fee/ Wallet / Profit 6
3.4.6 Private Data 6
3.5 Connection of Dealogic to Investment Banks and Investors 6

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1 Introduction
This document should help to get an understanding of Dealogic, its Vision and Mission and how
Dealogic is related to the Investment Banking industry.

In addition the document explains the main Investment Banking business concepts and its terms to
get a feeling for this business domain.

Further on it covers the existing technical systems mainly based around the “Cortex” system.

The document also tries to help to get an understanding of the company processes and the team
structures.

2 Dealogic | Performance Optimized

Dealogic is the platform utilized by investment banks worldwide to optimize performance and
improve competitiveness.

Implemented across strategy, capital markets, sales, coverage banking and compliance, firms rely on
Dealogic to interconnect their professionals to more effectively identify opportunities, cover the right
clients, evaluate investor appetite, execute deals reliably and to ultimately win more business.

Dealogic is the only firm in the world providing the technology, content and consulting used by
investment banks to manage and align their core operating units, leading to increased profitability
and productivity.

More than 25 years’ experience and a deep knowledge of the capital markets has put Dealogic in a
unique position to foster numerous long standing relationships and to work in close partnership with
investment banks globally.

2.1 Mission
Our Mission is to enable investment banking professionals and their organizations to achieve their
optimal performance

2.2 Vision
Our Vision is to enable our clients to optimize the flow of the world’s capital

3 Important Business Concepts

3.1 What is an Investment Bank (IB)?
Quite simply, an investment bank connects those who need capital with those who have capital, and
takes fees for joining those parties together in a deal.

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Investment Banks bring clients together in these two groups by structuring deals in any of the
following deal types. These deal types are internally also called Verticals:

• Equity Capital Markets (ECM) (selling a stake in the client’s company in order to raise capital)
• Debt Capital Markets (DCM) (Borrowing money in the bond market in order to raise capital without
selling a stake)
• Syndicated Loans (Loans) (Borrowing money from banks in order to raise capital without selling a
stake)
• Mergers & Acquisitions (M&A)

The size of the Investment Bank’s fee is typically determined by risk of a deal and viewed in the form
of ‘basis points’. A basis point is .01%. Scales are different for varying types of deals.

3.2 Structure of an Investment Bank

The following picture describes a high level view of the hierarchy structure of an Investment bank and
the main areas of their work.

3.3 Processes of an Investment Bank

The following schematic diagram explains the normal process of an investment bank from creating a
strategy for areas of investment, via targeting companies to the execution of a deal and its
documentation.

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3.4 Investment Banking Domain Knowledge
As in every industry specific wordings are used inside Dealogic. To help to get an understanding of the
financial and investment banking domain and to help to follow internal conversations and discussions
main business wordings are described in this chapter:

The Investment Banking World can be broken down into four verticals ECM, DCM, Loans and M&A.

Each of these verticals can be broken down into Deals.

3.4.1 Deals & Tranches

The financial world thinks in ‘deals’ and banks and investors focus their daily operations around deals.
Depending on the complexity of a deal, a deal can be broken down into one or more tranches.
The process of a deal from its initialisation to the end can be divided into steps, different for each
Vertical.

The whole process of a deal, independent of the vertical, can be broken down into structured
information which can be saved in a database.

Through having the right data and powerful data analysis, strategic and summarised information can
be extracted which can help banks and investors in their daily operations and allow them to make
more sophisticated decisions about e.g. their investments in different parts of the world and in
different industry sectors.

3.4.2 Tranche Based Information

For the calculation of Bank related performance information and for the aggregation of sums it is
necessary to think on tranche level and not on deal level. This is the case because different tranches
of one deal could be handled by different banks and to get the view per bank just the tranches
handled by one bank have to be considered.

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3.4.3 Entities
An Entity is any kind of group or organisation or person connected to a deal.

Main Entities are

- Banks (connecting those who need capital with those who have capital)
- Companies (anyone who needs money (or is sold in case of M&A)
- Clients (anyone who pays fees to the bank)
- Partakers (anyone else on the deal who isn’t one of the other roles, e.g. Shareholders)
- Financial Sponsors (providing funding / money for the deal, e.g. pension fund, hedge fund)

Generic entities

These entities could be connected with each other to form e.g. groups. Entity structures contain
parents and children. Please see paragraph Client / Parent logic.

3.4.4 Roles
For the execution of a deal different roles are needed. These roles vary between different verticals.

The execution of a role in a deal is executed by a specific entity, e.g. a specific bank.

Here are some examples of important roles, grouped by entity types:

Roles for Banks:

Vertical independent roles:
- Bookrunner (IB which leads deal )
- Lead-Manager (IB which leads deal )
- Co-Manager (also on the deal, but lower than Lead Manager)
- Underwriter (like an insurance: if deal goes wrong they pay for deal)

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ECM / DCM specific roles:
- Issuer

Loan specific roles:

- Arranger (arranging loan, loan equivalent of bookrunner)

M&A specific roles:

- Financial Advisor (advises on Target, Acquirer, Divestor)

Roles for Company / Client / Financial Sponsors:

Vertical independent roles:
- Target
- Borrower
- Acquirer (Investor)

M&A specific roles:

- Divestor

Roles for Partakers:

Vertical independent roles:
- Guarantor
- Originator
- Selling Shareholder

3.4.5 Deal Value / Volume / Revenue / Fee/ Wallet / Profit

The Deal Value is the amount of investment per deal.
The Volume is the Sum of all Deal Values.
The Revenue / Fee is money Investment Banks make per Deal.
The Wallet is the Percentage of Revenue per Deal.

The Profit is the money Investment Banks make in the end. So it is the Revenue minus their costs. This
information is not in the systems as the costs per bank are unknown.

3.4.6 Private Data

Private data is bank specific information owned by the bank and not accessible to the public. It is high
priority to ensure that this data is not accessible by other parties.

Banks have different levels of security for their data. Some of their private data they deliver to
Dealogic to allow the overwriting of Dealogic naming conventions. To achieve this the Dealogic data is
mapped (‘concorded’) to the client data.
This data consists of
- Company names (e.g. Dealogic: Microsoft, Bank: MS)
- Regions. (e.g. Dealogic: USA, Bank: US)
- Industries (e.g. Dealogic: Telecommunications, Bank: Telco)

Regions and Industries can contain different layers as well, e.g. for Regions: 1. Asia, 2. EMEA, 3. Egypt

Banks also have Very Private Data. This is data which they do not want to see outside their firewalls.
To create reports on this data the report generation has to run inside the bank.

3.5 Connection of Dealogic to Investment Banks and Investors

Dealogic offers a platform for Investment Banks to support them in their daily operations of handling
deals in every vertical. The Investment Banking platform consists of different Dealogic products which
cover the full life cycle of a deal.

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All Deal related information is stored in a central data place called ‘Cortex’. Through this centralised
place for data powerful products can be built which cover the whole deal execution process for
investment banks and investors and this allows sophisticated financial analysis. Dealogic offers the
information to Investment Banks and Investors through sending (‘pulsing’) data to them and to allow
them to have aggregated and summarised views of the historic and current financial situation in the
world and to make strategic, well informed decisions e.g. about possible investments.

As every client might see the world from a different view point, the Dealogic data can be merged with
client specific / private data. This process is called ‘Fusion’.

In addition the analysed data is used internally to support the Dealogic business side, e.g. the Bank
Relationship Managers and the Marketing and Press teams.

Here is an overview of the financial processes from a Dealogic Cortex centric view:

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