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Operations M&A Services

Operations M&A Services

Helping clients FIND, DELIVER and KEEP deal value across the deal lifecycle.

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Mergers and Acquisitions

Operational Due Diligence

Due diligence means more than ticking a box as clients expect to deliver value and minimize risk during the potential acquisition or separation of a business. Through a structured top-down approach, we help clients conduct Operational Due Diligence across all facets of the business, including: front office and back office operations, while uncovering potential synergies, risks, and cost savings opportunities.

As Canada's most experienced M&A team, we know what to look for and provide insights, practical advice, and timely information to clients during a transaction. Our team blends rigorous accounting and financial assessment with insights from our functional specialists to identify and quantify operational upsides and risks associated within a transaction.

Our Operational Due Diligence team support clients in the following ways:

  • Synergy Analysis: Building robust synergy cases such as savings, one-time costs, phasing and scenario planning is important to extract value within an Integration. We have seen clients benefit from a comprehensive assessment of existing synergy cases in order to ensure shareholder value remains during an integration.
  • Carve-Outs: Separating a target business from its parent company can be a difficult and time consuming process for clients. Our team of experts at KPMG are skilled at identifying the operational challenges and quantifying the on-going and one-time costs expected to operate a business on a standalone business.
  • Operational Assessment: In addition to quantifying synergies within a transaction, clients either buying or selling a business are also interested in a thorough assessment of their current operations in order to ensure best-in-class performance. With the KPMG’s robust deals database, we are able to benchmark historical performance, individual costs and identify key risks for clients to ensure the operational upsides are quickly identified and can be acted on by senior leadership.

Integration and Separation

Integration Services

Closing the deal is only the beginning. Through KPMG's integration services, we help clients drive value throughout the deal and beyond. That means hitting the ground running with measures to protect the business at deal close, driving quick wins within the first 100 days, and embedding strategies that will realize long-term value through full integration.

Our team support clients in the following ways:

  • Integration Due Diligence: Material risks may impact deal value and pre-close integration strategies. Our team of experts historically have advised clients on the overall integration approach to deliver optimal value during a transaction by defining the strategic rationale for the deal, developing the target operating model and creating actionable milestones to ensure senior leadership is best prepared for Day 1.
  • Day 1 Readiness: Ensuring a structured Day 1 plan during an integration is key to success. We have seen clients benefit from a robust program management office, comprehensive Day 1 program plans and negotiated transitional service agreements with the target organization. We help clients focus on the most important pieces of information to ensure long term business stability from the moment the deal closes.
  • Post-Close Integration: Integrating a new business can be a daunting proposition for clients. Clients rely on our team of dedicated specialists to prioritize key synergy projects that deliver quick-wins, manage the cross-functional interdependencies and dependencies, and ensure a thorough people and communication plan exists for the target company culture of the combined organization

Separation Services

From assessing the current value of the business to preparing and enhancing value prior to the divestment opportunity, KPMG's approach to separation services focuses on structuring the carve-out to help maximize deal value.

Our team support clients in the following ways:

  • Separation Due Diligence: Developing a clear view of how your business will be separated, and identifying the associated risks that may impact deal value is what KPMG’s separation experts do best. This includes defining the separation perimeter (what is transferring with the business, what is not, and the associated risks), mapping the separation approach, and clarifying transition service agreements. All combined, these services help provide potential buyers with the comfort of knowing your management has a clear plan for before, during, and after the separation process.
  • Day 1 Readiness: Preparing to separate a target business from the parent company can minimize value leakage within a transaction. We develop detailed transition service agreements with clear costing and transition timelines, establish a robust program management office to help mitigate Day 1 operational and legal risks, and leverage KPMG's deal database for Day 1 plans to accelerate your deal close and separation planning.
  • Post-Close Separation: Minimizing disruption to the business during a transaction through a focus on key priorities and avoiding stranded costs for the parent company will provide a boost to shareholders during a separation. Our team of experts help clients develop a view of the target operating model for the separated business and establish strong project management offices to help drive detailed project planning, implementation and risk management.  

Technology M&A Services

Technology can be the most costly, complex, and time-consuming aspect of a transaction. IT systems, infrastructure, data, and people must be migrated from the seller's environment to the buyer's possession, and delays or errors during the transition can trigger significant issues in the days, weeks, or even years following an acquisition. Moreover, failure to unlock technology synergies or address unseen gaps can erode deal value.

While the risks are many, so too are the opportunities. Successfully overcoming technology obstacles during a deal can enhance value – especially when transition timelines are fast-tracked with robust technology assessment and planning. Our industry-proven Technology M&A specialists can help you navigate the complexities during the full deal lifecycle through core Technology M&A Services.

Our Technology M&A team supports clients in the following ways:

  • Technology M&A Due Diligence: Without an evidence based view during a transaction, the possibility of incorporating risks and downside to your business is high. We have guided both buy-side and sell-side clients with broad, value-focused IT due diligence throughout all stages of the deal to help uncover, assess, and quantify IT deal risks. From our experience, investments in IT can have a significant impact on company for valuation and planning purposes.
  • Technology Synergy and Integration Services: Prospective buyers need to rely on data-driven insights to make an informed buying decision. Our Technology M&A experts provide buyers with early-stage IT synergy assessment and IT integration plan in order to help realize synergies as early as possible while minimizing IT integration costs and potential risks.
  • Technology Separation Advisory: IT transition, if not carefully managed, can severely impede the timescale and feasibility of achieving the full benefits of a separation. During separations from shared corporate IT environments, our clients have benefitted from value-enhancing IT functionalities in order to help minimize the risks, costs, and transition timelines associated with IT separation from shared environments.

Value Creation

Extracting value during a transaction or maximizing earnings potential prior to a sale is where our team of Value Creation specialists can help you thrive. We specialize in delivering sustainable improvement in profitability and liquidity with clear, concise, and actionable plans that allow you to implement change "at deal speed". 

Through a hypothesis-led, data-driven approach, we help Corporate and Private Equity clients alike with rapid performance improvement, cost reduction and business transformation initiatives. We leverage our proprietary data analytics tool to benchmark performance and find opportunities for clients to focus on the most important initiates that deliver quick wins within and outside the deal space.

Our Value Creation team support clients in the following ways:

  • Operations Improvement: Clients are always seeking new ways to drive performance in a tough business environment. We have been able to show clients the untapped financial potential by using a structured approach to rapidly disaggregating operating drivers, exploring areas that can drive a material impact on financials and ensuring out clients business is utilizing the best operating strategies given their core business model.
  • Cost Reduction: Increasing productivity, and therefore doing more with less is increasingly becoming an option for clients looking to explore cost reduction opportunities. KPMG’s proprietary Target Value Platform (TVP) tool helps optimally benchmark clients with peers in order to find specific areas of potential savings quickly and efficiently. Using this data-driven approach, clients are able to focus on areas that are likely to optimize cost and performance in the long term.
  • EBITDA Maximization: Our team of dedicated Value Creation specialists ensure clients receive the right price by making rapid EBITDA improvements and reducing complexity in what some might consider a challenging M&A lifecycle. Establishing an organizational and financial baseline allows us to gain insight into our clients operations during the launch business transformation programs. This new lens provides a view to strategic options identification, upside quantification, delivery, and ultimately empowers our clients during negotiations with prospective buyers.

 

© 2020 KPMG LLP, an Ontario limited liability partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

For more detail about the structure of the KPMG global organization please visit https://home.kpmg/governance.

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