Mergers & acquisitions transaction services: engineering design and assembly business

Challenge:

Client with limited resources needed to conduct financial analysis and reporting process to determine closing price of acquisitions.

Existing challenges included:

• Unsophisticated Target with poor quality financial data which inhibited client’s ability to assess performance and ultimately valuation.
• Lack of financial and human resources at Target to address financial reporting and record keeping deficiencies.
• Time sensitive process upon which to provide client with a report and recommendations on the transaction.

How Mazars helped:

We assembled a team of skilled M&A professionals who were experienced in financial planning and process.

Solution:

• Perform a targeted analysis into core accounting processes of the business, primary being percentage of completion accounting, to address inaccuracies distorting results.
• Analyze balance sheet for possible working capital considerations that would affect closing purchase price.
• Provide suggestions to correct and strengthen the quality of financial reporting.

Result:

• Provided client with accurate view of the financial results of the business, and recommendations for go-forward financial reporting improvements to implement.
• Informed client of various accruals and deposits that should be included in the debt of the Target, as opposed to net working capital, resulting in a decrease in purchase price of the transaction.
• With accurate financial information and clear visibility into accounts, client was able to close on the transaction