Transformation Prior to Divestiture – Industrial Conglomerate
The Project
TBP was engaged to provide several CxO level interims to improve the value of a subsidiary in preparation for divestiture.
The Problem
Our client had decided to divest an underperforming subsidiary; however, a change of leadership and a sharp increase in revenue and EBITDA was needed to allow the client to achieve its sale price potential.
Approach
We engaged a senior team to formulate and execute a performance turnaround. The work covered sales leadership; operation transformation (focused on manufacturing) and financial modelling support throughout the transformation. We led initiatives in the following areas over a 12-month period:
Definition of a 5-year business plan
Implementation of new policies and procedures to drive improved performance in focused areas such as a new marketing approach (covering pricing and product strategy); KPIs and the recruitment process
Implementation of lean manufacturing
Cost restructuring focused on fixed costs and overheads
Handover to a new leadership team
Outcome
The transformation was very successful with:
20% increase in revenues
80% increase in profit – EBITDA
The subsidiary was sold at a substantial premium – 80% above valuations made prior to the transformation
