What function do investment banks serve in MandA transactions?

Investment banks play a crucial role in M&A transactions by providing advisory and valuation services, making them essential intermediaries in the process. Their expertise helps companies navigate the complexities of mergers and acquisitions, ensuring that both parties make informed decisions.

The advisory services offered by investment banks include conducting due diligence, assessing the strategic fit of the transaction, and identifying potential synergies. They typically help in structuring the deal, determining the valuation of the target company, and negotiating terms that are favorable to their clients. Additionally, investment banks possess the financial modeling and analytical skills necessary to value a company accurately, which is pivotal when determining a fair purchase price.

In contrast to the other roles suggested in the choices, investment banks do not provide insurance for investors, act as buyers for distressed companies, or manage public relations during a merger. These aspects may be relevant in broader contexts of finance or corporate communication but are not the primary functions of investment banks in the context of M&A transactions. Their main value lies in their ability to facilitate and shape the M&A process through expert advisory and financial insight.