Operational due diligence

Your challenge

The sharp increase in M&A activity means more than ever a focus on operational matters as a driver for the value of a transaction. Both strategic buyers and Private Equity houses are increasingly looking for ways to steer the value of a transaction, looking at operational improvement potential and proactively managing operational risks. Banks are also increasingly looking for the operational aspects of a transaction by looking more critically at the business plan, the operating performance and the hardness of supposed synergies.

Our solution

Our Operational Due Diligence team combines in-depth expertise in the field of operational structuring and performance improvement, thereby creating insight into operational risks and possible upsides of a transaction. By combining sector specialists and functional experts with Operational Due Diligence experts, we are able to provide in-depth insight into both pre-deal diligence and post-deal value creation.

Why Deloitte?

Our team can perform site assessments. Site visits provide you with

• Insights into the target to observe real-world performance, concerns and potential
• A consistent overview of site performance
• A deeper understanding of separation challenges and risks
• Comfort on cost-base, investment and operational improvement plans

Our team can assist in analyzing forecasts and upsides, by highlighting principal risks and pinch-points underpinning management’s plans as well seeking insight on further operational opportunities. Key benefits:

• Clarity on key operational assumptions underpinning management forecasts
• Potential negotiation points related to risks in forecast costs and investments
• Additional upsides to management plans to enhance potential offers

Our team can assist in analyzing the separation impact, by reviewing the target’s standalone cost base and the complexity of separation. Key benefits:

• Documented separation challenges and risks to factor in negotiations and advance planning
• Quantified sensitivities to the standalone costs
• Assessment of one-off separation costs and transitional services from the vendor

Our team can assist you with synergy development, by developing and validating the plan, focusing on several key areas including baselining, one-off costs, planning and phasing. Key benefits:

• Independent validation of your identified synergies to support deal valuation
• Identification of further synergy opportunities
• Robust approach that can support external announcements
  

By joining forces with Deloitte, you gain access to proven methodologies and draw on the experience of local experts as well as the international expertise of >300,000 professionals from the Deloitte network.

Being part of Deloitte Transaction services, we work closely with our Financial (Vendor and Acquisition), Commercial and Technology (IT) Due Diligence, Corporate Finance, Debt Advisory, PMI and Carve-out teams, to provide you with our integrated insights into each stage of the M&A life cycle. We also leverage the audit, risk management, and tax services of Deloitte’s network to bring additional resources to our Operational Due Diligence engagements.