Acquisitions & Disposals

ACQUISITIONS

Introduction

Buying a business is a huge commitment of management time and money. A well executed acquisition can be the springboard for substantial profit growth and value creation, whereas a poorly executed acquisition can in the worst case result in business failure. Regardless of the effort that is put into undertaking due diligence in order to understand what is being acquired, the realities of ownership regularly bring surprises that due diligence did not identify, in addition to the initial requirements that it did.

Typical Issues

• No clear 100 day plan of what needs to be done once the transaction completes
• Business integration – clear identification and ownership of new responsibilities
• Management of and exit from transitional services agreements
• Delivery of cost savings and synergies in line with expectations set during the acquisition process
• Failure to harmonise business practices and cultures
• Failure to harmonize management information to support day to day performance management
• Requirements to implement new IT systems
• Demands of integration falling to the same people who are then distracted from “the day job”

How We Can Help

We can set up and run a project management office to identify all workstreams related to achieving a successful business integration. This will ensure that there is constant visibility regarding the progress being made, and that resources are effectively balanced between the integration requirements and the ongoing day to day activity.

Our team can also take ownership of workstreams, helping to deliver the business case on which the acquisition was justified.

Relevant Experience of the Team

• Reorganisation of two management teams to remove duplication of structures, delivering substantial cost savings and ensuring management responsibilities remained clear.
• Early exit from transitional services agreement, including on time implementation of new IT systems.
• Timely factory consolidation, transferring production and increasing capacity of productivity of the receiving site.
• Review of business administrative processes, identifying duplication, opportunities for streamlining and delivering savings.

DISPOSALS

Introduction

 Selling a business or part of business requires significant commitment from management and takes time away from ongoing operational activity. The objectives of any disposal process are threefold: ensure that maximum value is obtained for the owners, secondly ensure that the business being exited goes to a good new owner, and thirdly ensure that the disposal concludes.

Typical Issues

• Lack of good management information to present the business in the strongest way possible
• Poor presentation of management information – failing to draw out strengths and opportunities
• Identifying the full population of potential buyers to create a competitive buyer environment
• For partial sales, managing the transition process of separation – transitional services agreement, reorganization of the retained business, managing the synergies and dis-synergies of separation

How We Can Help

We can support owners and managers compile management information and ensure that it is presented clearly for potential buyers to understand. We will ensure that the strengths and opportunities in the business are clearly highlighted and evidenced. Areas of weakness and other external threats will be identified and risk mitigations proactively presented.

In respect of partial disposals, we can run a project management office to ensure that the post disposal workstreams are properly coordinated, and impacts on the retained business are understood and properly mitigated. We will work with the management team to ensure that transitional services agreements are effective and exited in a timely manner.

Relevant Experience of The Team

• Preparation of management information pre sale.
• Delivery of management presentation to prospective purchasers.
• Negotiation of appropriate disposal structure to ensure disposal transaction concluded.
• Negotiation of disposal related transitional services agreements. 
• Negotiation of closing balance sheet adjustments, affecting the final proceeds from disposal.
• Management of internal communications related to disposal.