TRANSACTIONS + RESTRUCTURING

ACCELERATION

Rapid, Sustainable Performance

ACAL helps CEOs and business leaders deliver rapid visible, and sustainable step-change improvement in business performance, while strengthening their organizations and positioning them to win in the years ahead. We work shoulder to shoulder with ambitious clients seeking to change the trajectory of their companies, whatever their starting point.

CORPORATE Transformations

What Is Transformation? And Why Is It Now a Global Imperative?

Transformations are comprehensive changes in strategy, operating model, organization, people, and processes. They aim to achieve a dramatic improvement in performance and alter a company's future trajectory.

Across industries and regions, the need for business transformation is enormous and growing. In today’s unpredictable business environment, disruption arises from all angles. This reality leaves public companies with a 1-in-3 chance of ceasing to exist in their current form over the next 5 years, up from a 1-in-20 chance 50 years ago. In addition, CEOs and senior leaders are under increasing pressure as activist investors and boards push them to do more—faster.

Transformation is a tool that all companies can use to improve their value to shareholders, whether they are trying to catch up quickly or retooling to stay ahead.

Transformation as Preemptive Self-disruption

In the past, a transformation effort was seen as a radical solution—a sure sign that a company had broad, systemic problems and no choice but to change. We refer to these types of transformations as turnaround and restructuring efforts.

But in fact, more than 25% of companies that have undergone a transformation effort over the past decade have done so from a position of strength. These preemptive change programs frequently enable companies to “self-disrupt” and continue to generate value.

ALWAYS ON TRANSFORMATION.

We see transformation as an imperative in today’s business landscape even for companies dominating their market. Operating in a default state of self-imposed disruption is now the only valid response to unpredictable forces, such as the emergence of digital technologies and market volatility.

All companies should focus on transformation as an “always-on” process of evolution to maintain their competitive advantage as market conditions change.

TRANSACTION SERVICES

For any individual asset, the private equity value chain begins with the decision to invest. What is the genuine potential of this business? Should we invest or let it pass?

A successful private equity investment begins with a clear view on the sectors of interest to the fund, driven by a clearly articulated investment strategy. This is followed by systematic lead generation and thorough assessment. Once a promising target is identified, the quality of the due diligence process is critical. Here are six key steps to follow:

  1. Assemble the right due-diligence team with in-depth industry knowledge, and hit the ground running on day one.
  2. Assess the sustainability of the business, especially identifying the downside risks and how they can be mitigated.
  3. Identify the long-term growth opportunities, and make sure the company has the minimum capabilities to take advantage of them.
  4. Start developing what ACAL calls the full-potential plan early, paying particular attention to the short list of cost-improvement initiatives that will deliver quick results.
  5. Identify the potential upside that can be targeted to deliver substantially more value than the asset’s base-case business plan.
  6. Understand management’s ability to deliver the investment case and what adjustments might be required.
  7. Following these steps helps a private equity firm determine whether or not a clear business case can be made to acquire the target company.

By combining objective analysis with broad industry experience, we help clients evaluate and execute complex strategic transactions to drive sustainable growth.

HOW WE DO IT

Change in business is constant. Regulatory environments, globalization, industry boundaries, and cost pressures are all in perpetual motion, and idleness is never an option. The complexity of managing acquisitions and divestitures, though, can be challenging for even the most experienced corporate leaders. This is why we play a critical role supporting all phases of transactions—before, during, and after—to ensure deals are consistent with corporate strategy and achieve maximum value. We work with clients to deliver an M&A strategy that targets many deals above a more sedentary approach and to develop in-house M&A capabilities in advance of and during a transaction or event.

Our consultants combine their extensive transactional expertise with a deep understanding of specific industry sectors to support clients on four types of transactions.

Mergers and acquisitions

We help clients ensure that their M&A strategy aligns with their broader corporate strategy. We identify and assess targets based on a client's strategic objectives, potential synergies, organizational and cultural fit, and the feasibility of a deal. To help the transaction proceed smoothly, we support clients in structuring the deal, communicating its rationale to stakeholders and markets, and planning for integration. To provide a foundation for success after the deal closes, we help clients tailor the integration process, governance mechanisms, and organization to the transaction's strategic objectives. All the while, we build our clients’ internal processes and capabilities to execute successful transaction programs.

Alliances and joint ventures

We analyze our clients' needs and the situations that prompt them to look for a business partner. The goal may be to enter a new market, start a new business, gain access to a technology or product, or improve industry relationships. We also assist them in identifying the best possible partners and assessing the potential for value creation. As plans for an alliance go forward, we help our clients develop the strategy and skills necessary to structure, negotiate, and implement the arrangement.

Divestitures

In recent years, many companies have taken a more critical look at what businesses they own and why they own them. We help clients critically assess their portfolio in order to better understand their core and non-core businesses. To support divestitures, we help clients value the relevant business, identify possible deal structures, and support key issues affecting negotiations, such as the impact on vendors and the possible need for supply agreements with the acquirer.

TRANSFORMATION ISN'T AN OPTION—It's A BUSINESS IMPERATIVE.

Today’s business volatility is unprecedented. And whether the causes are new technologies and digitalization, globalization, blurred industry boundaries, regulation, energy dynamics, or other factors, the message is clear: transformation isn’t an option, it’s a business imperative. Forward-thinking companies are launching transformations even when they dominate a market, retooling themselves so they stay ahead. The goal is a transformation that’s focused, sustainable, and able to deliver measurable results.

TALK TO US TODAY

OUR CLIENTS

© 2019 ACAL Consulting

Copyright © 2018 ACAL Consulting Limited.

All rights reserved.

By combining objective analysis with broad industry experience, we help clients evaluate and execute complex strategic transactions to drive sustainable growth.