Case Study
Driving portfolio company growth and expansion strategy for an American PE firm
Target Identification | Bolt-on Acquisition | Inorganic Growth Strategy
Business need
- A US-based private equity (PE) firm was seeking geographical expansion opportunities for its portfolio company in the Professional Employer Organisation (PEO) sector.
- As part of this exercise, it had shortlisted a few high-priority states in the US where it wanted to expand operations.
- The PE firm was therefore seeking targets for its portfolio company that could give it a foothold in the selected regional markets.
To identify bolt-on targets for a PEO in selected regional markets of the US.
The client outlined two key reasons for selecting RocSearch:
- Our proven investment research and advisory capabilities.
- Our comprehensive RocEye target identification approach.
Approach and Methodology
- Our investment research and advisory team scanned 1,600+ PEOs. The focus was to identify companies that had their operations spread entirely or partly across 18 priority states in the US.
RocSearch used its proprietary RocEye target identification approach to screen over 1,600 PEOs and created a pipeline of c. 80 bolt-on opportunities across the US.
- We used our comprehensive RocEye target identification approach to screen over 1.,600 PEOs.
- We created a final shortlist of 100 companies that met the client’s investment criteria.
- For each target company, we captured key data points such as company size, revenues, ownership, presence and service capability.
Business Outcomes
- The pipeline of bolt-on opportunities helped the boutique PE firm initiate its diligence on 8 investment-worthy targets.
- The portfolio team of the GP finally approached 5 shortlisted targets for advanced discussions and closed the deal with one of them.
The PE owners were able to strategically map the bolt-on target landscape and execute their inorganic growth strategy.
