Corporate finance case study

Issue

• Our client, a Belgian entrepreneur, mandated PwC to find a appropriate buyer/investor for his business.
• The entrepreneur knew that fresh capital was required to support his strategy to grow the business going forward as a leading player on the market.
• At the same time, the entrepreneur was very keen to stay involved in the development of his company.
• Market conditions were harsh and potential buyers were unable to match the entrepreneur's price expectations or their strategy was not in line with the one he had in mind for the company.

Approach   

• We drew on the experience of our PwC international corporate finance network throughout Europe and used our combined knowledge of the business’ industry to highlight potential acquirers.
• As depicted below, when approaching purchasers, we focused both (1) on the existing business value of the company and (2) the future shareholder value maximisation through growths.

Recommendation

• We presented our client with a potential buyer:
  • A robust and financially sound international Group;
  • We convinced the Group to use the company as a platform to market its products on the Belgian market.
• We assisted our client in managing the entire disposal process through:
  • Drafting an Information Memorandum and teaser;
  • Organisation of an interactive dataroom;
  • Workshops with management to identify synergies;
  • Liaison with lawyers;
  • Negotiations with the Group (deal structure, price, guarantees, exit strategies, etc.).

Results

• The entrepreneur was able to benefit from an attractive price for a majority divesture of his shares and to get the commitment to fresh capital injections.
• As a result, the entrepreneur still holds a minority stake in the Company, allowing him to benefit from future upward potential.
• The Group has appointed the entrepreneur as CEO for the combined operations to realise the agreed growth strategy to maximise the shareholder value.