The Issue
A mid-market private equity firm was considering the purchase of a provider of business process outsourcing (BPO) services to state governments. The firm wanted to better understand the industry, market opportunities, and competitive landscape, as well as the target's revenue outlook, given their pipeline and contract backlog.
The Approach
With expertise in managed services in technology sectors, Waterstone partnered with the acquiring firm to study the competitive landscape and market opportunities of the target industry, as well as assess their future financial performance. Waterstone strategically analyzed the market
(market size and growth, competitive landscape), and how the target was situated to address opportunities. Waterstone interviewed and assessed the strengths and weaknesses of their management team, and evaluated their organizational structure. Finally, Waterstone identified
key growth levers and provided insights into how the acquiring firm could realize greater returns than they had planned. The diligence engagement was completed in less than four weeks.
The Results
With Waterstone's input, the target was successfully acquired, and Waterstone was asked to partner with their management team to develop a growth strategy roadmap. After thorough analyses of market and company resources, Waterstone identified accelerated growth opportunities to deliver +50% additional revenue over what was planned during the acquisition hold period, and double the company valuation by year five.
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Client
Mid-market private equity firm
Issue
Business & market diligence
Approach
Provide revenue expectations, evaluate
the industry and market opportunities,
and asses the management team
Results
Target acquired, with a growth
road map in place to increase
revenues, and double the
valuation within 5 years
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