Private equity

Investment

Generating and identifying solid leads requires a clear view of what type of investments your fund excels in. It also requires extensive knowledge and connectivity to the marketplace. In an increasingly competitive environment, how do you cut through the noise to find a strategic fit for your investment needs? And can you generate enough quality leads to outperform your competitors and sustain deal flow?

Is this a good company and is the price right? This is the first question that must be answered before any PE fund proceeds to the next phase in the deal flow process. Yet, there is no magic formula or right answer. Financial and commercial due diligence covering the company’s financial performance, commercial operations and earning potential against competitors or industry benchmarks are necessary and to identify growth drivers and risk factors which affect potential synergies and costs of acquisition. Meanwhile, valuation models can vary by industry making it more difficult for in-house teams to determine if “the price is right”.

At PwC, we invest in people and relationships to help our clients throughout the deal flow process. Our people have extensive experience working with a broad base of clients across all industries and many of our corporate finance specialists have worked in leading investment banks. As independent advisers, we make it a priority to help you meet your strategic investment needs. Meanwhile, we have a team of strategy consultants and sector-specific deals, tax and audit specialists to put your needs first. With your objectives in mind, we leverage our industry perspectives and technical knowledge to recommend ways in which you can maximise value in structuring deals and negotiations.

How we can help?

Audit

• Purchase price allocation (PPA) accounting
• Closing audit
• Light due diligence

Tax and legal

• Tax and legal due diligence
• Tax and legal structuring advice and implementation
• Tax transaction cost analysis
• Tax modelling
• Fund flow analysis
• Sales and purchase agreement (SPA) review and negotiation support

Deals

• Target or investor screening and brokerage
• Industry and market research and assessment
• Advice on capital raising
• Buy-side financial advisory
• Preliminary target review
• Financial, commercial, HR, operation, IT, Data and legal due diligence
• Closing assistance
• Valuation, PPA accounting
• Project management (PMO)
• Deal advisory, SPA review, negotiation support

Portfolio company management

The first hundred days after closing can determine the success of merger and integration. How do managers turn a newly acquired business around and realise synergies? What should be the priority: enacting cost savings, optimising operations, motivating people or all of the above? In divestitures and carve outs, short term fixes such as a transactional services agreement may be needed to sustain operations until a longer-term solution is ready. Meanwhile, the reality is that a range of performance improvement measures are concurrently needed, requiring both attention to detail and expertise in areas such as financial reporting, tax regulation, IT and operations, human resources and internal controls.

How we can help?

Audit

• Audit of portfolio companies
• Financial function effectiveness and internal control
• Accounting advisory

Tax and legal

• Tax, regulatory and legal compliance at portfolio level via technology (e.g. entities management, tax reporting and strategy (TRS))
• Value creation plan and delivery: tax and transfer pricing planning, treaty benefit planning and application, VAT exemption planning
• Ongoing tax review and health check (including trade and customs services)
• Pre-IPO restructuring and employee stock ownership (ESOP) planning

Deals and consulting

• Taking control
• Post-merger integration
• Value creation plan and delivery
• Portfolio performance monitoring
• Responsible investment and sustainability
• Investor screening and brokerage for capital raising of portfolio companies

Exit

A successful exit, be it through an initial public offering, strategic acquisition, secondary sale or management buyback, requires forward thinking and planning to ensure that the right pieces are in the right places at the right time to maximise both fundraising potential and an investor’s return on investment. Our team of specialists can work with you to assess your options at each step along the way, sharing our global insights on fundraising, origination, capital markets developments and listing requirements in China and international stock exchanges.

How we can help?

Audit

• IPO audit
• Pre-IPO financial effectiveness, IPO readiness

Tax and legal

• Vendor due diligence and assistance
• Exit tax planning and support: exit tax structuring and compliance, defend and negotiate favourable tax settlement basis with tax authorities
• Sale and purchase agreement review and negotiation support
• Foregin exchange remittance

Deals

• Potential buyer screening and brokerage
• Sell-side financial advisory
• Vender due diligence
• Vendor assistance
• Deal pricing strategy
• Valuation services
• Restructuring services