Value creation in private equity deals

Look at your portfolio from a different perspective

The deal is just the beginning

Maximizing value through the entire transaction lifecycle

For private equity (PE) companies looking for a good deal, there are dozens of variables to account for—from rising valuations and high levels of dry powder, to fierce competition in the market.

While this landscape can be challenging, it also offers ample opportunity. Mergers and acquisitions (M&A) are a chance for transformation—for bringing business models, workflows, and workplace cultures into the 21st century. At the practical level, being clear on the value creation potential can increase the probability of winning the deal and delivering against the deal thesis.  

With the right strategies, people, and analytics in place, you can optimize performance throughout the entire lifecycle.

At PwC, we help our clients ensure no value is left on the table. By bringing together our end-to-end capabilities across the M&A lifecycle, we provide an integrated approach that delivers value to your portfolio companies.

Sean Rowe, PwC Canada's Value Creation leader

“Our dedicated Value Creation team is uniquely positioned to help you execute transformational deals in today’s complex deal market.”

Sean Rowe, PwC Canada Value Creation leader


Getting a head start through diligence

Operational due diligence is a necessary part of any deal, helping acquirers to understand risks that could potentially erode value. More and more, PE firms are deploying their value teams early in the deal lifecycle to identify sources of value and support deal teams in increasing their chances of winning the deal.

With analytics, visualization tools, and global industry experience, we help PE clients identify hidden deal breakers and opportunities by:

  • Performing operational data analysis to identify opportunities to leverage capacity and increase throughput rates.
  • Uncovering people risks through workforce analytics and external data.
  • Identifying revenue growth opportunities early in the process including pricing, cross/up-selling and customer profitability levers.
  • Evaluating past M&A activity to understand the ability to deliver against synergy, cost, and timeline commitments.

In the age of big data, there’s no shortage of tools to help you assess deal benefits and risks well in advance—but sometimes you need an advisor to help make sense of all that information. Our team will work with you to structure your analysis so you can capitalize on all your deal opportunities.

Executing buy and build strategies

Platform investments are becoming increasingly common as industries converge and more PE firms adopt aggressive buy and build strategies for their portfolio companies. These plays can accelerate revenue growth and drive margin expansion—as long as the acquiror can realize synergies.

Because today’s buy and build strategies can involve acquiring platforms with add-ons from other industries, pre- and post-deal integration efforts have become much more complex. We help portfolio companies drive operational synergies over extended time periods by:

  • Finding targets that would be accretive to the value equation.
  • Identifying new sources of synergy during the diligence process by using data and analytics.
  • Providing an integrated financial view of the target to help you approach buy and build strategies with confidence.
  • Accelerating the path to integration, through an agile, cost-effective integration process from day one.
  • Overcoming cultural barriers to ensure that teams are integrated and have the right skill-sets and capabilities.
  • Transforming operational capabilities, workflows, processes, and teams.

We bring an experienced and objective point of view to the table to help you deliver value from buy and build acquisitions.

Navigating successful carve outs

PE firms are increasingly acquiring parts of large corporate companies. These carve outs are complex as a result of their entanglement with the parent, and the need to quickly stand up key operations of the carved out business. For PE firms, this means putting strategies in place from before day 1 to exit the transition service agreement (TSA) in a timely manner—without losing key talent or overlooking important value drivers.

We help PE firms take an approach that focuses on people, process and technology with a view to accelerate the path to value by:

  • Establishing cost targets to minimize dis-synergies and accelerate the exit from TSAs.
  • Transforming key capabilities and technologies including digital adoption and transformation.
  • Leveraging analytics to uncover additional value at deal speed.
  • Developing the strategy for the stand alone business and the roadmap to accelerate the path to value.
  • Meeting financial and regulatory obligations with carve out financial statements on day one.

We understand the divestiture process from all angles and are here to take care of the details so you don’t have to.

Delivering value in the first 180 days

The first 180 days post-deal are critical as management and deals teams articulate the roadmap to achieve the deal thesis. This thesis will serve as the value blueprint for the business, outlining core considerations from across business functions.

We can assist your post-deal strategies especially in situations where there is a need to dramatically enhance the performance of the business by:

  • Using analytical tools throughout the post-deal process to identify new opportunities and help you manage the delivery of results.
  • Putting the right leadership team in place, one that demonstrates the desired cultural attributes and operates as a cohesive team.
  • Boosting sales and back office productivity to drive step-change improvement in profitability.
  • Running a results management office to oversee post-deal initiatives and the value creation targets identified in the deal thesis.
  • Optimizing the tax structure to meet your goals.

No matter where you need to focus your attention, we help put the right post-deal strategies in place to maximize value.

Realizing latent potential before a sale

The sale of an asset is a critical event. If you’re well prepared, you can benefit from a higher premium. We can help you assess the sale value by:

  • Making use of data and analytics to streamline efficiencies and clean up the balance sheet.
  • Streamlining the organization structure to optimize spans and layers, and focus on critical capabilities and activities.
  • Applying lean techniques to drive operational process improvements.
  • Evaluating business portfolios to determine which assets should be divested, and develop a plan accordingly.
  • Running an effective results management office to focus on rapid delivery of results, and taking corrective actions to achieve targets in advance of a sale.

Building up the value of an acquisition and selling it is incredibly fulfilling—but there’s likely more value that can be uncovered before the final deal is delivered. We’re here to help you at the beginning of this process and the end, so you’re not leaving value on the table.

Creating value beyond the deal - Canadian insights

Canadian dealmakers face increasing pressure to quickly deliver a new deal’s anticipated value. Yet all too often, deals fail to realize promised synergies and achieve the expected value.

Find out more

Contact us

Sean Rowe

Sean Rowe

National Deals Markets and Value Creation Leader, PwC Canada

Tel: +1 416 815 5093

Sachin Jayapalan

Sachin Jayapalan

Partner, Value Creation, PwC Canada

Tel: +1 416 814 5797

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