In the context of M&A transactions, buyers are often confronted with the question of an appropriate determination of the purchase price. Significant information asymmetries between the buyer and seller side usually become apparent when both sides disclose their ideas on the company valuation for the first time. To be able to carry out a company valuation under objective conditions and to reach a purchase price agreement, due diligence checks must be carried out. The aim is to uncover hidden risks as well as opportunities and to include them in the company valuation.

Our approach

Situation

Situation

If parts of a company or even entire company structures are sold, the buyer and seller must reach an agreement on the purchase price within the framework of due diligence. This aims to consider all opportunities and risks and, based on this, to ensure an objective valuation of the transaction object.

Target

Target

The aim of a due diligence review is a company valuation without any subjective influences from the buyer or seller side. To secure the planned purchase, the transaction target must be carefully analyzed, examined and evaluated for this purpose, so that clarity can be created within this framework about traded opportunities and risks.

Solution

Solution

The specialists of ensign advisory have extensive M&A experience and support in due diligence reviews of all kinds. In the tight schedule of due diligence, it is important to identify all relevant opportunities and risks through careful analysis and examination for the purpose of a comprehensive risk assessment. The results of the individual examinations flow together in the due diligence report, which is used as a basis for decision-making in the final price and contract negotiations.

In the context of transaction intentions, we advise our clients in a completely neutral manner, jointly define milestones and achieve them. If clients want to invest for strategic reasons, we check above all the willingness to change and the qualifications of the employees, as well as the documentation of all processes and information flows, current budget allocations and the attitude of the clients. If clients want to invest with a financial focus, we focus above all on the quality of the management level and the leadership personnel, compliance with budgets, liabilities of all kinds, the functionality of quality management and all legal corporate structures.

Result

Result

The due diligence reports of our consultants support the investment case and clearly show where risks and potentials are to be expected. Our reports are holistic and sufficiently exhaustive in their respective areas so that our clients can make well-founded and secure decisions based on them.

Our core competencies

Commercial Due-Diligence

In the context of commercial due diligence, ensign advisory's consultants analyze and assess companies from a market, competitive and customer perspective and help our clients to understand and validate business planning as well as corporate strategy. Our internal, performance-based analysis focuses on the company's input, output, material resources/technologies, personnel, and organization as well as on synergy potentials. In the external environmental analysis, our consultants evaluate the industry structure, market development and potential, competitive positions as well as macroeconomic influences. During the analysis, we identify initial optimization and value creation potential for the period after the transaction.

Operational Due-Diligence

Operational due diligence serves to analyze the value creation structures and possible potentials regarding the company's performance. ensign advisory analyzes the actual productivity of our client’s takeover target so that they can better assess the extent to which the company is operationally positioned. Corresponding analyses require an in-depth understanding of the operational processes as well as the industry. With the help of our extensive expertise, we analyze the entire value chain of the company and uncover its weaknesses and the potential risk factors of a transaction. In addition to information on the company's performance, our clients will also receive initial starting points for the subsequent operational integration of the company into their processes.

Digital Due-Diligence

During a digital due diligence, our team analyzes and evaluates the current state of digitization and the associated requirements for the IT of our client’s acquisition target across all areas. Our analyses also include a review of existing and future risks due to digital dependencies or technical obsolescence. Further aspects concern the digital competence of the company's employees as well as the IT structure as the interface between IT planning and digitization.

IT Due-Diligence

IT due diligence serves to take stock of the IT of the takeover target - also regarding a possible carve-out and subsequent integration into the IT structures of our client’s company. In an IT due diligence, ensign advisory's consultants examine the IT infrastructure, organization, and strategy of the target company. At the same time, we assess the costs, expertise and process flows as well as contracts with current service providers. ensign advisory determines the main factors influencing IT and their importance for the company's success. During this, we use data analyses and expert interviews to provide our clients with a comprehensive overview and identify potential transaction-relevant risks and challenges.

Technical Due-Diligence

As part of a technical due diligence, we examine the condition and operation of the technical facilities and processes in the target company to uncover, for example, future investment needs and other cost structures. Furthermore, we analyze the areas of innovation and R&D management, quality assurance, life cycle costs and, with a special focus, the areas of maintenance and repair.

Join our team of experts

ensign advisory GmbH

How can we help you?

Get in touch

  • This field is for validation purposes and should be left unchanged.