In the private equity world, KPMG provided financial due diligence to Europe’s largest private equity transaction, the £1.3bn buyout of oilfield service company, Expro.
KPMG Private Equity Group Transaction Services were engaged in February 2008 by Candover, Goldman Sachs and Alpinvest to provide buy-side financial and pensions due diligence services for the June 2008 take-private of Expro International Group.
The due diligence timetable for the size and nature of this transaction was extremely aggressive (two weeks from the opening of the data room to signed diligence reports and fully committed debt and equity packages). Coupled with very limited access to financial information and the restrictions on access to management resulting from the need to impose a level playing field on all bidders, this created an immensely challenging environment for due diligence. KPMG was forced to work ruthlessly, efficiently and in an extremely creative manner.
A spokesman for the consortium said: “We truly feel that the KPMG Partner and his team are doing and amazing job for the consortium – without them it would be very difficult to get this deal done.”
KPMG corporate finance was also busy acting in the interests of private equity managers. In December 2007, KPMG Corporate Finance was mandated as lead advisor to BWA Water Additives and CBPE to sell the speciality niche chemical producer for water treatment. After a highly competitive process, BWA was acquired by Bahrain-based investment bank United International Bank in September 2008. KPMG ran a highly tailored auction process. Although the specific terms of the transaction are confidential, KPMG provided CBPE with a return of over 3.5x its original investment in 2.5 years. Iain Slater, investment partner at CBPE said: “The team at KPMG Corporate Finance helped us deliver a very successful exit for CBPE in what was certainly a difficult climate for M&A. BWA operates in over 80 countries and we were looking for an advisor with global reach. KPMG’s connections in the Middle East region helped identify the eventual purchaser.”
In October 2007 the UK, German and Swiss firms merged to form KPMG Europe LLP. It was the first of the ‘big four’ to undertake such a move and it is KPMG’s ambition to merge other KPMG firms from across Europe with KPMG Europe LLP as quickly as possible. This innovative move to club resources will help KPMG and its clients weather the current economic downturn.
Ernst & Young