Delivering deal value is far from a mystery, even in today’s dynamic deal environment. The most experienced deal makers say they know what to do. But success is getting harder to come by.
Getting the right balance
Deal success remains all about execution. Our experience of working on deals of all shapes and sizes tells us that there are three key aspects to keeping a balance between the integration and the core business.
- Value: maximise the value through clear objectives and targets that explicitly focus on value delivery.
- Control: objective challenge and a proven ‘fit for purpose’ process to manage risk, priorities and scope.
- People: it is essential to manage people effectively through a time of great uncertainty.
Although every transaction has unique objectives, we make sure you have clarity about what you want to achieve.
Here’s how we can help:
- Focus on detailing the value to be delivered, maintaining strong control over scope and cost, and supporting people through the change. It’s important to us that the plans developed are owned by management and we work collaboratively to achieve this.
- Assemble a team with three areas of capability – integration specialty, industry insight and experience across the different business functions.
- Help you develop the business and synergy cases,
- Create integration plans that get the client from A to B quickly,
- Assess your readiness for integration or the success of past acquisitions,
- Verify the due diligence and provide the practical methods and tools.
Divestitures and carve outs
Whether divesting part of your business or targeting a disposal, a Carve Out process offers the opportunity to challenge and optimise the Carve Out entity's operating model. We have experience of divestments ranging from standalone businesses, to the most complex Carve Outs, across a range of sectors, advising on the sell side and buy side. We understand both vendor and buyer perspectives and their impact on value to maximise your ability to deliver deal value.
Our flexible and rigorous Carve Out approach focuses on what really matters:
Developing a fit for purpose, cost efficient, standalone operating model
Preparing robust and executable separation plans across operations and IT that safeguard the core business
Defining flexible transitional arrangements to ensure the business can operate from Day 1
If you’re planning to sell or purchase part of a business being carved out, here’s how we can help:
Divestment Support (helping you prepare for sale)
We specialise in supporting vendors to prepare robust separation plans which stand up to the rigours of due diligence and maximise sale proceeds in the following areas:
Identification of inter-company dependencies and separation risks
Definition of an optimised standalone operating model for the Carve Out entity
Optimisation of the vendor's remaining core operations
Definition of an efficient IT environment to support the standalone business plan, along with subsequent implementation support for the separation plan
Advice to define the optimal Transitional Service Agreements (TSAs) and Long Term Arrangements (LTAs) required between the Carve Out entity and Vendor
Support throughout the sale process (including bidder meetings).
Carve Out Due Diligence
On behalf of bidders we review management's separation plans including the following areas:
Robustness of the one-off, ongoing and stand alone cost assumptions/estimates
Ability of the IT systems and infrastructure to support the stand alone business
Completeness and flexibility of transitional arrangements
Robustness of separation plans, including Day 1 readiness and capability building to migrate off transitional support.
Carve Out Planning and Implementation
Working alongside the management team, we develop detailed separation plans covering the period's pre and post Day 1 (separation point). Our depth of Carve Out experience ensures that critical Day 1 risks and actions as well as key steps to establish the standalone capabilities post TSA support are managed, minimising business disruption and allowing management to focus on business as usual.
We provide a structured implementation approach that flexes with client needs, enabling effective management of the separation including:
Detailed status reporting
Issue and risk management
Structure and discipline within the transition management office.
Carve Out Financials
We advise management on the preparation of Carve Out Financial statements to meet regulatory requirements, taking into account the optimum way these statements should be presented to investors.
Operational due diligence
We can help you, our client in buying and selling businesses by combining our full range of specialised industry knowledge with our deal experience. Our team works with corporate and private equity clients to assess potential merger synergies, stand-alone performance improvement opportunities or key operational risks, on both the buy and sell side of M&A transactions.
The approach taken by the team is issues-focused and is based on our industry knowledge and experience of supporting clients across all stages of the deal cycle.
Our team can quickly provide you with invaluable insight and perspective on the operational risks and improvements which can be made to reduce cost and leverage value in both core operations and back office functions.
We can help you :
- Gain an understanding of a target's operations and its risks
- Identify performance gaps and potential for rapid improvement, e.g. through cost reduction, operational restructuring and off-shoring
- Provide an insight on key deal issues and opportunities - even if limited access/information is available
- Assess carve-out issues and associated costs
- Identify and challenge synergies
Post deal performance improvement
In many ways, one of the most important parts of a deal is its completion because this is where the deal’s benefits and value need to be realised. Too often, though, deals fail to deliver – frequently because of the lack of integration between the business and its newly-acquired asset. Put directly, to make a deal work , considerable resources are needed.
Here’s where our in-depth knowledge and experience are put to work for you.
- We have extensive experience of helping businesses integrate new acquisitions. Our teams comprise many individuals with "in-line" industry experience.
- We have developed specific tools and techniques that have proved their worth in other transactions. Their early application can save considerable time and money.
Is this your situation?
- You are integrating an acquisition and you ‘re concerned it will consume valuable time and resources, detracting from the focus on the core business.
- You have issues with employee management. Where competition for talent is keen, and employee benefits and compensation programmes are more complex, attracting, motivating and retaining employees can be difficult.
- Your deal is not delivering the potential value forecast when originally put together.
Here’s how we can help
- Our dedicated teams of professionals work on-site to help manage the changes that a deal generates.
- We address the immediate concerns of the acquirer over the first 100 days of the acquisition and produce detailed action plans to deliver value from the deal.
- We carry out post-deal reviews after 6 to 12 months to assess whether objectives are being met and if not, how to get them back on track.
- Our board knowledge of HR issues allows us to give practical advice on employee management. We help our clients navigate the wide variety of employee programmes used and help them choose the best programmes to achieve all potential synergies.