Case Study

Acquisition Due Diligence and M&A Experience To Support A New Team

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Insights

  • A recently formed private equity firm identified an acquisition target in the energy space
  • The target was privately owned with a strong record of growth and an enterprise value of approximately $30 million
  • The target was an asset-heavy, capital intensive business that required continual cash infusions
  • The PE firm developed a recapitalization plan for the target and received a lukewarm reception to its proposal
  • With no energy or sector-relevant executive management expertise, the PE firm was searching for a way to expand its capabilities and improve its reception by the target

Action

  • A Newport partner with extensive energy sector experience was retained
  • The target’s financial and operating information was reviewed and assumptions were validated around the company’s business
  • A roadmap was developed for future business development and growth opportunities
  • The Newport partner also provided the PE firm credibility with the target company as well as with potential transaction funding sources
  • The Newport partner further provided both strategic and tactical advice on how to successfully navigate through a prolonged deal process

Results

  • Ultimately, a transaction was announced with another buyer, with the PE firm as runner-up
  • The PE firm is now pursuing other opportunities and the Newport partner was retained as a fractional operating partner to assist in pursuing additional acquisition opportunities
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