Updated: May 24, 2022
WCA's Operational Due Diligence Service (ODD) ensures that you unlock the true potential value from a target company.
Operational due diligence is a time-consuming and highly intensive undertaking that typically involves multiple parties and extends over a number of phases. At WCA, however, we encourage our investor clients to carve out as much time as possible both for the due diligence process and the associated pre-closing activities. In our view It is imperative that the senior leadership team makes a clear determination - prior to closing - of where the real value creation potential lies within the target company.
WCA has developed a rigorous methodology to ensure that all potential areas of opportunity and risk for the investor are addressed during the entire due diligence process. Our six-step program outlined below is designed to facilitate cross-team collaboration with any additional subject matter experts or specialist advisors appointed by the investor. We have built efficient workflows into the design of the end-to-end process to enable a smooth transition between each stage. And naturally, we place great emphasis on maintaining strict governance of every phase of the deal lifecycle.
1. Deal Strategy
WCA agrees an overarching strategy for the end-to-end due diligence process with the investor, comprising the following elements:
primary objectives of the due diligence effort
definition of the roles and responsibilities of each party
issue management protocols
interim reporting schedules
indicative timeline for completion
Each element of the strategy is fully aligned with the initial investment thesis and the desired outcome of the deal. We aim to establish productive and positive working relationships with all participants in the process from the outset, based on our customary open and candid communications style.
2. Online Data Room
WCA works with the target company to establish, maintain, and update a well-organized online data room, thereby enabling the due diligence activity to be conducted in an orderly and efficient manner. Protocols are defined and agreed for the compilation, storage, dissemination and revision of all documentation to the authorised participants nominated by the investor.
Data security underpins everything we do. It maintains the integrity of our service delivery and protects our hard-earned reputation. Complete confidentiality is a key element of our operating charter. To this end, all online data is securely archived at the conclusion of the deal cycle.
3. Disclosure schedule
WCA ensures that the target company makes an early commitment to a comprehensive disclosure schedule addressing all aspects - commercial, technical, financial, legal and regulatory - of the due diligence process. This procedure also requires the target company to identify any known exceptions to the representations and warranties contained in the initial acquisition agreement.
WCA agrees the detailed parameters of the due diligence process with the investor, using our comprehensive checklist as a guide. The agreement specifies the following elements:
the functional areas of the target company to be audited;
the documentation to be disclosed and scrutinized;
the assessment of available operating plans and financial models;
the permitted levels of access for each party to sensitive, deal-related information.
These criteria then define the overall framework for the entire due diligence effort.
WCA undertakes the due diligence process in accordance with the agreed guidelines and in collaboration with any third-party functional specialists. We provide continuous feedback to the investor with a view to resolving any deal-critical issues and mitigating any known risks in a timely and pro-active manner. Avoiding surprises and ensuring complete transparency are the overriding priorities of this phase of the activity.
6. Final Offering Formulation
After all documents and data points are examined and synthesised, WCA guides the due diligence team through a structured evaluation of the findings. In parallel, the financial analyst group utilize the information collected to apply various analysis techniques and valuation methodologies. This activity substantiates the final offer and associated deal terms to be negotiated with the target company.
Want to know more about working with us in Indonesia? Please feel free to contact our Jakarta office directly.
Don’t delay, our team of due diligence specialists is ready to discuss your requirements today!
Incidentally the Operational Due Diligence (ODD) service from WCA is a pre-cursor to our newly-launched offering for investors which we call ‘Integrated Execution Service’ (IES).
One of our long-held beliefs at WCA is that the selective outsourcing of existing investment-related processes - such as the stewardship of exit-critical work programs - will maintain your leverage and visibility within the ventures and/or portfolio companies that you may hold in Indonesia.
Our activities span the entire investment cycle and comprise market evaluation, due diligence, business plan formulation, management team alignment, enterprise-wide communications and continuous work program management.
We have designed our ‘Integrated Execution Service’ (IES) offering with a view to assisting you and your team in maximizing your exit valuations. Our approach comprises two components:
rigorous up-front business planning and work program specification
the implementation of a high impact, low maintenance Program Management Office (PMO) capability.
Simply put, we convert your investment thesis into pragmatic and value-added execution programs, which we then manage diligently on your behalf - from inception through to exit. And we are not passive ‘scorekeepers’ - we are proud to characterize our workstyle as ‘activist and interventionist’. We deploy dedicated local resources in Indonesia to act as your on-the-ground representatives. Our intent is to ‘avoid surprises’ by managing problems as they arise and resolving critical issues proactively.
Don’t delay, our team in Jakarta is ready to discuss your requirements today!