The 2027 Goldman Sachs Video Interview for Investment Banking asks a basic-looking merger question with a hidden trap. Naming more reasons is not the goal. A strong answer distinguishes strategic logic from the conditions required to create value.
The actual interview question
Here is the complete wording:
Investment Banking: Why might one company buy/merge with another company?
How you lose points
- Listing motives without structure: Growth, synergies, and diversification become buzzwords when you do not explain the mechanism.
- Equating strategic fit with value: A sensible target can still destroy value if the buyer pays too much.
- Counting revenue twice: Market access and revenue synergies may describe the same benefit and should not be treated as separate proof.
- Ignoring the funding choice: Cash, debt, and shares change risk, ownership, and the return required from the deal.
- Skipping execution: Integration, regulation, culture, customers, and talent can prevent an attractive plan from becoming an attractive outcome.
How you pass
Organise the answer into strategic motives, financial effects, and feasibility. Strategic motives include entering a market, adding a product or capability, strengthening a competitive position, securing supply, or accelerating growth that would take longer organically.
Then explain how the combination could create value. Cost benefits may come from removing duplication or gaining scale. Revenue benefits may come from distribution, cross-selling, or a broader offering. Financial motives may include deploying excess capital or changing the combined funding profile. Each benefit needs a credible path, timing, and owner.
For a hypothetical example, assume a software company buys a smaller cybersecurity provider to add a capability customers already request. The strategic logic is faster product expansion. The value case depends on customer retention, achievable cross-selling, integration cost, and the premium paid. This example is hypothetical and does not describe an actual transaction.
- State the strategic problem the transaction solves.
- Separate cost, revenue, and financial effects.
- Compare the deal with organic investment and other alternatives.
- Test price, financing, regulation, and integration risk.
- Conclude with the conditions under which the buyer creates value.
The correct answer is not that companies merge for synergies. It is that a transaction can solve a strategic problem only when the benefits exceed the price and execution risk.
Get the ones for your role
This is one question from the Goldman Sachs Investment Banking assessment. OfferTutoring has the complete questions for the role so you can prepare the full interview with the same level of precision.
