Operational Due Diligence
Operations matter in a deal
Operational matters are increasingly important in the current deal market. Buyers are taking a more active role in unlocking value from operations. Sellers include more operational efficiency initiatives into their business plans, which often form the basis for bids.
Banks also frequently request operational due diligence reports when providing deal financing to obtain comfort that business plan assumptions are robust.
How can we support you with providing comfort around key operational deal questions?
Apart from providing detailed insight into the operational set-up and footprint, the following key operational deal questions are addressed in an operational due diligence:
- What are the main operational risks across the whole business?
- Is the business plan operationally feasible? (e.g. sufficient available capacity)
- Are the cost and capex projections realistic and based on clear and validated assumptions?
- Are savings from planned operational improvement initiatives achievable? Are priorities clear?
- Can more value be achieved on top of the business plan?
- What potential synergies can be captured? What are timeframes and costs to achieve?
Insight into these areas provides more comfort with regard to future cash flows and the value potential of the business.
We work closely with both corporate and private equity clients to provide a tangible estimate of the potential value and advise on key deal issues and opportunities. Our combination of unrivalled industry experience and deal expertise means that we know what to look for in the target business and how the issues can be addressed.
Our team can support buyers post deal to further detail and implement operational improvement initiatives. For further reference, please see Rapid Value Creation.
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