M&A planning and successful IPO
The task to prepare the company for Mergers and Acquisitions (M&A) planning and successful IPO:
The client was a privately-owned, locally integrated producer of advanced materials. At the time of Alexion Partner’s Mergers and Acquisitions (M&A) engagement, the company had over $160 million in sales, and employed over 500 people across 4 production plants and two R&D center over Europe and Asia.
The company acquired another materials company in an aggressive three year roll-up strategy to build a globally integrated acetyl chain. Alexion Partners was engaged to identify and capture operational synergies, integrate the acquisitions and develop the ongoing operating platform. The task was to prepare the company for a possible M&A or IPO.
Achieving profitable growth was a fundamental challenge. While inorganic growth was a key strategic initiative, our client felt as though internal acquisition and integration teams lacked the required experience. Fundamentally, the lack of a structured internal approach and necessary capabilities posed risk to successfully building a globally integrated manufacturer through a roll-up strategy.
A senior team of Alexion Partners created a robust integration and performance improvement process driven by a combination of five key factors:
- Creation of a clear and common understanding of success – Vision
- Establishment of financial, logistical, and governance targets, focused on driving the right behaviors; “High level” targets were broken down into logical levels (target trees), which in turn fed a function specific activity list, ensuring alignment, transparency, prioritization and measurement – Planning
- Development of a framework for key personnel to make timely decisions, and support the rapid timeframe necessary for integration – Program Management
- Development of clear processes, leadership training program, leadership accountabilities and organizational structures to drive success –Organization and Human Capital
- Implementation of communication plan and management control and reporting systems that fostered teamwork and tracked achievement – Execution and Result
Over the course of the three successfully targeted, executed and integrated acquisitions, the company had not only realized its vision of being a globally integrated manufacturer, but also achieved synergies such as:
- 55% increase in overall productivity
- 21% EBITDA as a direct result of the Alexion Partners’ performance improvement program
- Alexion Partners managed multiple and successive acquisition integration programs, exceeding financial targets in a compressed time-to-value cycle
- Improved profitability & growth within the first year of an integrated operation
- Established new processes in value pricing, product development, customer service and planning with 15% reduced headcount
- Installed a Management Control and Reporting System to achieve a controlled and transparent integration system focused on critical activities
- At the end of third year a successful IPO was realized, and majority shares were sold to a PE firm– securing a healthy return for all stakeholders.