Case Study
Stressed asset identification for a European PE firm
About the Client
- Client is a private equity firm, with investment focus in Europe on companies that require minimum equity investment of €100 million
- Sector focus: Business Services, Consumer, Financial Services, Healthcare, Industrials, and Technology, Media and Telecom
Business Need
-
Identify potential acquisition targets that are under financial distress:
- Sector: Healthcare
- Firm type: Private
- Geographic focus: US, Canada and Europe
Approach and Methodology
- A comprehensive data set of companies in this sector and geography was created using information collated from proprietary databases, associations, Meetings, Incentives, Conferencing, Exhibitions (MICE) events, news aggregators, etc.
- More than 10 themes were identified to develop a robust framework that could identify companies in different stages of distress. The themes were restructuring, legal proceedings, management changes, payment defaults, etc.
- Weights for each theme was fixed and triggers were used to arrive at a consolidated score for each target to measure the relative attractiveness
- Triangulated trigger analysis with the quantitative analysis (revenues/ employees, wherever available)
- The final output was shared in the form of a monthly newsflash, highlighting the recent targets under distress
Business Outcomes
- 38% increased visibility on potential targets for the client
- Assistance in raising funds to the tune of €350M+
- 300+ analyst hours saved in deal origination
- 14 investment gems (highly or moderately stressed) identified from a list of 1000+ companies