Service

Portfolio value creation for private equity sponsors

Pulling the key levers that drive value and improve EBITDA

Jeffrey Kollin

Jeffrey Kollin

Principal, Advisory, Private Equity, KPMG US

+1 917-438-3946

Paul de Janosi

Paul de Janosi

Advisory Managing Director, Strategy - PDT, KPMG US

+1 215-370-1599

Joanne Heng

Joanne Heng

Principal, Deal Advisory and Strategy, KPMG US

+1 213-593-6663


Private Equity (PE) firms have a proven track record of performance in both good and bad markets, consistently outpeforming other asset classes over multiple business cycles. With inflation and interest rates rising, along with labor and other resource constraints, PE firms and portfolio company CEOs must continue to prove they can drive growth and increase EBITDA.

The strategic intent of the KPMG advisory team is to support our clients’ success by accelerating sustainable EBITDA value in portfolio companies. Where feasible, we work side-by-side with a PE firm’s deal and operating teams and its portfolio company’s management team to identify levers that drive value.

 

Our rapid diagnostic process

To help our clients, we have designed a rapid diagnostic process to help portfolio companies quickly identify potential near-term cash generation, EBITDA, and other performance improvements. Our approach features an holistic assessment of a company's financial and operating performance along with its processes and systems, combined with proprietary KPMG tools and technologies and our deep subsector and functional experience.

Through this process, we identify opportunities across areas of the company and suggest targeted actions for achieving cash generation, EBITDA, and other performance improvements. Once we have reviewed these opportunities and gained alignment, we work with you to align your capabilities and availability of resources to development a roadmap for implementation.

Then, at your organization’s discretion, our experts can further guide you through the execution of select initiatives focused on value creation opportunities that have been identified.

How you benefit

The KPMG rapid diagnostic offers multiple benefits for your company, including:

Potential EBITDA and cash flow improvements

Permanent effective tax rate benefits

Reduced risk and increased cross-functional collaboration

More efficient operations across the organization

Areas of opportunity explored

Value Creation

Pricing

  • Assess pricing opportunities, including quick wins
  • Design future-state pricing strategy, structure, organization, and governance
  • Optimize price points, price tiers, rebates, promotions, and cost-to-serve

 Operations

  • Supply chain
  • SG&A
  • Sales and marketing effectiveness
  • Assortment and SKU rationalization
  • Customer and product profitability

Organizational effectiveness

  • Identify organizational inefficiencies
  • Design future organization structure
  • Optimize personnel cost

Profitability levers

  • Commercial growth
  • Operational efficiencies
  • Financial risk mitigation

Value Preservation

Cybersecurity

  • Cyber maturity assessment
  • Cybersecurity roadmap

ESG/Climate

  • ESG materiality and maturity assessment
  • ESG ratings improvement assessment
  • GHG inventory and decarbonization roadmap readiness assessment
  • Value-at-risk climate assessment

Forensic

  • Forensic
  • Investigations
  • Fraud risk assessment
  • Compliance
  • Anti-bribery and corruption assessment
  • eDiscovery and technology
  • Forensic data analysis
  • Corporate intelligence

Value Optimization

Working capital

  • Order to cash (AR) optimization
  • Procure to pay (AP) optimization
  • Supply chain/inventory optimization

Tax

  • EBITDA planning
  • Tax structuring and optimization
  • Credits, incentives, and refunds

Finance effectiveness

  • Current-state maturity
  • Operational and organizational gaps
  • Organizational design
  • Roadmap for implementation

Value Realization

Capital markets readiness

  • Initial public offering (IPO and SPAC)
  • Regulatory filings
  • SOX compliance
  • Executive compensation planning 

Supporting our clients’ industry subsectors

While we serve a breadth of industries and subsectors, the following primary areas of focus are based on our deep industry and subsector insights and experience, coupled with proprietary data and analytics. 

INDUSTRY AND SUBSECTOR CAPABILITIES

   


Consumer and retail

  • Direct to consumer
  • Durables
  • Education
  • Food and beverage
  • Health and beauty
  • Multiunit retailer 
  • Specialty retail
  • Travel, leisure, and hospitality
  • Veterinary


Energy and natural
resources

  • Aerospace and defense
  • Auto parts and aftermarket services
  • Building products
  • Contract manufacturing
  • Engineering and construction
  • HVAC
  • Industrial distribution
  • Paper, packaging, and labels
  • Transportation and logistics


Financial services

  • Cyber
  • Digital ads
  • Education
  • Hardware
  • Media
  • Semiconductors 
  • Software
  • Technology-enabled business services
  • Telecom
   


Healthcare and life sciences

  • Clinical development and  manufacturing organization
  • CRO/clinical trial
  • HC payor/provider
  • Healthcare systems
  • Hospitalist management groups
  • Lab diagnostics
  • Multisite provider
  • Nurse staffing
  • Pharma services
  • Specialty pharmaceutical


Industrial manufacturing

  • Direct to consumer
  • Durables
  • Education
  • Food and beverage
  • Health and beauty
  • Multiunit retailer 
  • Specialty retail
  • Travel, leisure, and hospitality
  • Veterinary


Technology, media, and telecommunications

  • Direct to consumer
  • Durables
  • Education
  • Food and beverage
  • Health and beauty
  • Multiunit retailer 
  • Specialty retail
  • Travel, leisure, and hospitality
  • Veterinary
   

BUSINESS SERVICES

Cross-industry, including subsectors