Situation
The client, a global manufacturer of medical devices, was performing exceptionally well, and its infusion care (IC) division had significantly contributed to its profits. Group management wanted to increase top-line revenue and profit growth within the IC division, which involved initiating inorganic growth initiatives. In pursuit of this, the client was actively seeking viable business opportunities that aligned with its growth ambitions while securing the future of the IC business. To facilitate this, IC recognised the need for support in establishing a ‘best-in-class’ screening process from opportunity screening to due diligence.
Approach
Valcon was chosen to align the M&A process design to support the strategic direction of the client’s infusion care division. The project was divided into two tracks, with the client overseeing one, and Valcon managing the other:
A. Strategic clarification: This phase involves examining the strategic decisions and scenarios arising from the corporate strategy and their implications for IC. This track was conducted by the client and addressed the first steps along the typical M&A life cycle, namely strategic clarification and business opportunity strategy.
B. Business opportunity review process: This component focuses on structuring a top-tier screening process, encompassing opportunity identification, evaluation and due diligence. This track was supported by Valcon and addressed the M&A process as well as the planning of the execution.
These two projects were closely intertwined, with the strategic clarification providing crucial input for designing an effective screening process.
Results
The project yielded three key areas of deliverables, driven by two main projects:
1. Strategic clarification: The project achieved management alignment on the strategic direction for IC, fostering a shared purpose in pursuing M&A activities closely tied to the group’s overarching strategy and ambitions.
2. Strategic prioritisation: Management was able to align and prioritise scenarios for further detail and pursuit, including a profound understanding of the implications of each scenario. This led to a defined list of must-win battles for each scenario with a main focus on M&A activities to achieve the desired ambitions.
3. Clear opportunity screening process: A comprehensive screening process was devised, commencing from the development of search criteria to the meticulous planning of due diligence. The key deliverables encompassed an overarching process and governance structure, opportunity screening criteria and the creation of one-pagers for each identified business opportunity.
