Identifying and exploiting opportunities to drive growth, transforming business models and enhancing efficiency in portfolio companies are essential for Private Equity investments particularly with increasing valuations and fierce competition on deals.
At the Private Equity Europe Forum 2018 in London, FTI Consulting, which works extensively with medium and large-sized funds to support their value creation programmes, moderated a panel of leading Private Equity operating partners to share their knowledge and their different approaches to enhancing value in their portfolio companies.
The panel consisted of:
- Amanda Good, Partner and Head of the Operations Innovation Team, Hg Capital
- Bertrand Pivin, Partner, Apax Partners France
- Immo Rupf, Partner, Cinven
- John Leahy, Founder, Partner and Head of Value Enhancement at DH PEP
- Volker Hichert, Founding Partner & Managing Director at Deutsche Private Equity
- Adam Bradley, Senior Managing Director, FTI Consulting
In summary, our panel revealed that leading funds are adopting a range of different but successful strategies when it comes to transforming portfolio companies:
- Developing a tried and trusted playbook that can be repeated with every investment, but with some flexibility on which initiatives are applied in which portfolio companies
- Creatively rethinking the Target Operating Model (TOM) function by function
- An aggressive buy-and-build process typically with clear synergies can bring about commercial and cost benefits
- The Operating Partner plays a key role in implementing business transformation in portfolio companies
- Digital transformation and the execution and integration of add-on acquisitions are critical capabilities.
Should you wish to discuss the issues raised, or to learn more about how FTI Consulting’s Business Transformation Practice works extensively with leading private equity funds and portfolio company management teams to shape and deliver value creation plans, please get in touch.