VEP helps clients manage the strategic risks and opportunities of enhancing portfolio shareholder value through
portfolio rationalisation – whether it be the corporate portfolio of business units, or the business unit portfolio of product/market segments.
We assess the strategic risks and opportunities facing each of the businesses:
1. Market demand trends, drivers, risks, opportunities
2. Industry competitive intensity, drivers, risks, opportunities
3. SBU (or segment) competitive position, strategy and internal strategic risks and opportunities
We assess management’s financial forecasts for each business against market demand trends, competitive intensity, company position and strategy. We build expected value cash flow forecasts for each business, derive NPVs and assess their sensitivity to the identified key risks and opportunities. We rank them by value impact and likelihood of occurrence. We cross-check NPVs with other approaches to valuation.
We assess each business against market attractiveness and competitive position, and recommend which businesses should be invested in, which monitored, which milked and which divested. We investigate the likely NPV impact of alternative scenarios of further investment, acquisitions and alliances on all continuing businesses.
We conclude with a recommended portfolio rationalisation strategy where the value impact if fully evaluated. And where the strategic risks and opportunities are highlighted and assessed for value impact and likelihood.
VEP helps get the strategic rationalisation decision right.
Contact us to find out more.