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In the biggest tech deal in years, Microsoft announced Monday that it will acquiring social media platform LinkedIn. Three Wall Street firms are going to make a bundle from the deal.
Morgan Stanley is the the exclusive advisor for Microsoft on the $26.2 billion purchase, while two small firms – Qatalyst and Allen & Co. – are advising LinkedIn, according to a release from Microsoft.
In total, the three firms will bring in as much as $65 million in fees from the deal, according to estimates from consultant Freeman & Co. Here’s the full breakdown from Freeman:
- Buy-side: $10 to 20 million to Morgan Stanley Sell-side: $40 to 45 million to Qatalyst and Allen & Co.
Microsoft announced that the firm will issue debt in order to finance the deal. Freeman & Co. estimates the company will issue around $15 billion in debt, a move that could generate another $40 to $60 million in fees.
Both Qatalyst and Allen & Co. have been on particular hot streaks lately. Allen & Co., considered one of Wall Street’s most secretive banks, has advised on deals from Time Warner Cable’s $80 billion merger with Charter Communications to PayPal’s spinoff from eBay.
Qatalyst is known for its focus on the tech sector: it’s former CEO Frank Quattrone worked on deals such as Amazon’s and Cisco’s IPOs during the tech boom of the 1990s. Since Quattrone founded Qatalyst in 2008, it has advised deals such as Google’s purchase of Motorola Mobility in 2011 with a small team of only 40 employees.