What's Your Favorite Deal?

This question separates candidates who read the Wall Street Journal and think about deals from those who only memorized technicals. Interviewers want to see: (1) you follow markets and M&A; (2) you understand WHY companies do deals (synergies, market entry, vertical integration, defensive consolidation); (3) you can speak to the financials — how it was financed (cash, stock, debt), the valuation multiple paid, and the premium; (4) you have a defensible opinion. It's also a fluency test: can you discuss a real transaction without a script?

Structure your answer in five parts. (1) The Deal — who acquired whom, for how much, when, cash/stock/mix. (2) Strategic Rationale — why the buyer wanted it (revenue synergies, cost synergies, new geography/product, blocking a competitor). (3) Financial Details — the EV/EBITDA multiple, the control premium paid over the unaffected price, and the financing structure. (4) Was It Accretive or Dilutive — at a high level, whether the deal added to or subtracted from EPS (see accretion/dilution). (5) Your Opinion — do you think it creates value, and what are the key risks (integration, overpaying, regulatory)? Lead with one sentence summarizing the deal so the interviewer knows where you're headed.

Choose a deal that is: recent (last 6-18 months), large and well-covered (so the interviewer knows it and there's public analysis to draw on), and ideally relevant to the group you're interviewing with (a tech deal for TMT, a pharma deal for healthcare). Avoid obscure private deals nobody can probe, and avoid deals so old they signal you're not current. Have a backup deal ready in case the interviewer says 'pick a different one.' Know the numbers cold — purchase price, premium, multiple, financing — because vague answers collapse under follow-up.

Expect: 'Why did they pay that premium / multiple?' (justify via synergies or strategic scarcity). 'Was it accretive or dilutive and why?' (cash deals using cheap debt are usually accretive; stock deals depend on the relative P/Es). 'How would you have advised the buyer / seller differently?' (shows judgment). 'What are the risks?' (integration, regulatory/antitrust, overpaying, debt load). 'What multiple did comparable deals trade at?' — be ready to reference comparable transactions. The deeper they probe, the more they're rewarding you for genuine understanding.