M & A
Commercial due diligence support for a P/E investor looking at an IPMI target
A mid market UK-based Private Equity Investor, focused on healthcare services and insurance broking
Commercial due diligence - evaluating key aspect of the targets business plan to evaluate the target company’s business plan
To validate the fundamentals of the target's industry niche globally and then to identify and review the plausibility of the key growth and profit assumptions in the target's business plan, in the UAE, Latin America/Carribean and in SE Asia. To be completed in 2 phases: 1st - 3 weeks; 2nd: 2 months.
Phase 1: This was uniquely achievable within the fast time frame by using MGG’s own proprietary global IPMI database, with a positive answer. Phase 2: Having identified the key value drivers within the plan/financials, we conducted ~30 tel and face to face interviews with the targets brokers and other competitors, brokers and regulators across the target territories. A particularly forensic analysis was also made on the profitability of each target IPMI/regional PMI segment in the UAE.
Several red flags were raised around regulatory and reputational issues as well as overly optimistic profitability assumptions in the UAE. The latter were further validated by an independent actuary called in as a result. The P/E consequently pulled out of the deal.