Livingbridge, a mid-market private equity firm, has been investing in fast-growing companies for over twenty years. Having previously worked with Equiteq on various investments in the knowledge economy, Livingbridge hired Equiteq to advise them on their first Australian investment in the leading project management consulting firm TSA Management.
The client's situation
Livingbridge, a mid-market private equity firm had been investing in fast-growing businesses for over 20 years. Following the establishment of their Australian presence, an opportunity arose in the market as TSA Management shareholders were looking to extract value from their 15 years of successful growth. Using our local understanding and global knowledge of the consulting sector, we had delivered successful collaborative experiences for Livingbridge in other geographies, therefore it was logical for Equiteq to advise Livingbridge on their first Australian investment.
Equiteq delivered a traditional advisory deal process which included operational due diligence, entry valuation, RFI management and coordination between other consultants. We made strategic recommendations for the investment committee through strategic reviews, analysis of the competition, positioning the offer against contenders, investment recommendations and analyzing the potential of buyers and valuations during a future exit.
In addition, we convinced the target to utilize Equiteq’s proprietary software and moderated assessment, the Equiteq Growth Accelerator (EGA) as an exercise to identify future value creation levers and then share and nourish discussions about scenarios with the PE fund.
Shareholder exit goals & deal rationale between buyer & seller
The existing shareholders who were the management team, sold a majority stake and stayed on board to deliver the next phase of the organization’s growth. A partial exit was an opportunity for them to reduce their personal risk and embrace a new phase of the company’s growth backed by a professional investor.
For Livingbridge, the investment in TSA Management provided them with the opportunity to deploy their funds in a fast-growing market in the Australian economy (PMO in infrastructure and social infrastructure), with significant room for value creation, organic growth and potential targeted acquisitions.
How did Equiteq deliver value to the client?
Equiteq Australia acted as the exclusive buy-side M&A advisor on this transaction. Our expertise in the consulting sector and investment banking capabilities created value for the buy-side client. We rolled out a unique approach for the PE fund, with the following deliverables:
- Due diligence report and financial modelling - RFI, bank and valuation models, coordination with different advisors and management of deal information sources.
- Exit paper - Identified the scenario of value creation, potential buyers and valuation upside based on the delivery of the business using sensitive analysis.
- Acquisition paper - A long list of potential acquisition targets with a short list of complementary firms to support, accelerate and de-risk the proposed business plan.
- Equity Growth Accelerator (EGA) - Delivery of Equiteq’s strategic proprietary software and moderated assessment with management to identify future value creation levers to share with the new shareholder.
Read the press release on this deal here.