ANTARA Case Study – Due Diligence Now

When a multi-billion dollar private equity firm needed to evaluate a potential investment in a media infrastructure business, they called on Ken Lee, one of ANTARA’s principals, to help them determine the near, medium and long term cash flow potential of their prospective investment. Through his experience as a banker, an investor and an operator, he was able to dig deep into the financials of the company more thoroughly than other consulting groups would be able to. Using this experience, he was able to more intimately understand the correlation between expenditures, revenues and cash flows, as well as assess how a company can maximize their return for a given level of risk.

The Situation

When Ken was engaged with this client, they were in the due diligence and deal assessment phase, reviewing the leadership, financials and opportunities for potential near, mid and long term financial performance to make a final determination on whether they should make the deal or pass on it.

The Solution

Ken implemented a fact and metric based assessment of the target company’s financial performance.

The Results

While we determined that the long term cash flow potential of the target company was high, we ultimately decided to pass on the deal. Ultimately, we determined that a bloated cost structure and a lack of recent execution excellence would downgrade the company’s near term cash flow potential.

As a result of our due diligence and deal assessment efforts, we were able to help this private equity firm save money in the near term and focus their investment dollars on a target that was more in line with their near term goals for return.