Panamoure was approached by a PE fund to perform a pre-acquisition Technology Due Diligence review on an upcoming lower mid-cap target who designed and manufactured electronic component boards for the defence, aviation, automotive and energy sectors.
The business faced several challenges: it was dependent on key product sets from China and Korea, it had important global clients but remained a small, family-run company in the UK, and it had not invested in technology beyond client-specific projects.
The fund required that we dug far deeper into the business model and technology stack to identify the risks to the business because of its lack of investment, supplier profile risks and its ownership of the intellectual property when developing bespoke technologies for its clients. The PE acquisition and Technology DD were not known to the interviewees; documentation was at a bare minimum and out of date. The corporate IT infrastructure was ‘shared’ by other entities and the IT manager felt uneasy about opening the IT skeletons cupboard. The third-party supplier contracts were also ‘missing’.
We were able to get the IT manager ‘onside’ and working with Panamoure quickly, and organised all key stakeholder meetings within a limited time, quickly identifying key supplier risks. We supported the local team in developing a contract database and managed to acquire signed supplier contracts directly from the suppliers by supporting the local management team. We developed a plan for mitigating key risks that appeared in the Technology DD report and enhanced the data room with full IT asset and audit documentation when we were informed that it was not possible. A full opportunities assessment was included as part of our report, including immediate EBITDA upside that was available from quick win activities.
Full Technology DD and Opportunities report within 5 days.
Related Case Studies
© 2024 Panamoure Group LLP
© 2024 Panamoure Group LLP
