Strategic repositioning in equipment leasing
For a Pan-European equipment provider, active in multiple lines of business (heavy transport equipment; machinery; mobile housing units; light vans …) we methodically mapped supply & demand trends in relevant (sub-) markets as well as customer needs and competitive dynamics.
For each line-of-business this involved hundreds of structured user interviews, conducted partly by an outside agency and partly by the client’s sales force, under our guidance. This research revealed usage patterns, fleet requirements, equipment needs & provider positioning, and from there potential new value propositions were derived. Three-year market strategies were drawn up, including asset acquisition/disposal decisions, investment budget, deployment of sales resources, the mix of rental and leasing solutions, new service ‘wraps’ around the assets, and required M&A activity.
Private portfolio / wealth modeling
For the family office of a private equity firm, we developed a quantitative tool to optimally invest residual cash, given both the risk profile of the (less liquid) current private equity investments, as well as the client’s desire to consider the possibility to invest surplus cash in a wider range of assets across multiple geographies and currency zones. Asset classes including equities, commodities, hedge funds, property and other private equity opportunities were considered, and a database of the historic total return and risk profile of this wide range of assets was assembled from multiple sources (in various currencies). This was used as input into the quantitative optimization model to assist in decision-making around cash allocation.
Valuation of a container leasing portfolio
We supported the negotiation process for the sale of a container leasing business that was under insolvency procedures. We created a valuation tool that was linked to the database of container contracts and which allowed to forecast future cash flows arising from contracts, depending on changes to contract terms, leasing renewal rates, and other strategic or economic factors. This highlighted the embedded value within the business (beyond the immediate cash flows derived from the existing contracts) and allowed for the effect of strategic levers to be tested. In this manner the achieved sales price was optimized.
Compensation scheme in an investment firm
We audited and improved a complex model to calculate value, investment profit, partner-bonus, and long-term incentive allocations for a major investment firm; this was an essential part of the human resources strategy relating to staff retention.
Investment case in insurance
For a private equity firm considering whether to buy an insurance entity, we constructed a financial model of the business, conducted targeted operational and market due diligence (which was linked to the financial model), so that the funding requirements and the investment case could be adequately assessed.
Capacity building for investment decision makers
We advised a range of private equity clients on issues relating to financial model integrity and validity, including for investments to be made in insurance, banking, telecommunications and real estate.
Process improvement in a leasing business
We worked with the management team of an equipment lessor to examine the top-down process logic of their business, focusing in particular on improvement potential in the customer-facing cycle, from initial commercial contact to the closing out of each leasing transaction. That yielded clear opportunities to streamline the customer experience and to speed up the cash cycle. By examining crucial intersects with supporting processes such as fleet management and vendor operations, the visibility on the order book could be greatly improved and operating costs managed more tightly.
Since we were working directly with top management, implementation proceeded swiftly. It became obvious that a restructuring of the commercial team and an upgrading of its profile and skill base was required, and that was put into place as one of the key planks to build on.
M&A strategy for a rolling stock manufacturer
For the Services Division of a rolling stock manufacturer, we developed an M&A strategy to fuel its ambitious growth plans. The assignment included an extensive evaluation of the rolling stock services market, value chain analysis and simulation of future customer spending, in order to identify the most attractive business segments and geographical markets. We recommended business design options for the client and identified suitable potential acquisition targets. Together with the client, targets were prioritized and an M&A plan developed. Further on, we supported the client in the acquisition process of selected targets, including data room analysis, non-binding offer preparation and due diligence.