We strategically assess, value and evaluate target candidates and businesses for potential acquisition.

Client Profile

Corporate mergers & acquisitions (M&A) activity in healthcare is expected to continue driven by increasing pressure on companies to control costs and accelerate returns.  Non-organic options to supplement firms’ organic growth, portfolio strength, geographic reach, and/ or profitability with transaction-related strategic alternatives are, for many, a necessity.  However, in an increasingly evolving healthcare landscape, it can be difficult to know which type of companies are most complementary – in terms of product overall or with respect to cultural alignment – and this is where we can help.  We support firms by providing a targeted, rationalized list of firms / products / candidates that are “right” based on a company’s medium (3-year) to long-term (5-year+) strategic outlook and overall portfolio.

Service Offering

We develop clear criteria for assessing potential target companies, using broad performance metrics (such as strategic fit, profit margin, geography, customer base and others) to narrow the search.  After an exhaustive and comprehensive search, we build recommendations through primary research evaluation and in-market conversations about the feasibility of a successful target.

Stakeholder management. We compare hypotheses with market validation (potential value in targets) and actionable opportunities to acquire assets.

Information flow. We agree on how much information you need to make actionable decisions against a practical time frame for gathering and digesting info.

Building value. We determine what part of the target company adds the most value, to frame scale and scope.

Debating with data. With our fact-base, we discuss and debate strategies and vet challenges to build consensus.

Unique Value Proposition

Having culled the universe of potential targets to an actionable and prioritized list, we filter our results based on parameters that fit within the firms’ strategy, while also considering the potential for value-creating synergies, and target / asset availability in the market.  Our value proposition for target screening involves a clear step-by-step process that progressively moves forward towards a short list.  We do this thoughtfully without sacrificing efficiency. 

The Treehill Difference

The truth is that acquisitions are more likely to destroy value than create it. By and large, more than half of all acquisitions lead to a decline in relative total shareholder return after one year (Source: BCG M&A Divestitures research).  Therefore,firms need tried and true methodologies to ensure that target identification is based on solid research, not hyperbole. We never “wing it”. We follow an explorative and explicit process that funnels strategic intent through planning, valuing, evaluating and negotiation. We surpass expectations given our ability to think through to the next logical stages – diligence and contracting – that would follow, in a purpose-driven manner. 

Regional Focus

Our clients predominantly reside in the United States, yet increasingly cross-border activities and interest in both directions involving major European-based targets is commonplace. 

How do we Measure Success?

We measure success through by finding something that “sticks.” We search for this adhesion through a process that allows us to narrow the funnel of choices each step along the way. Our success is represented through a progressive yet practical set of targets for acquisition or partnership. We use key metrics of a company and we order them by priority based on the buyer’s needs. For example, product fit metrics help us understand whether the products and services of the target company are in-sync with the existing product portfolio of acquirer. We look at the financial metrics of a target including growth and margin performance over time to understand whether the target would be dilutive or accretive to earnings. We examine geography, to understand go-to-market opportunities and we look at ownership structures to understand the implications on capital structure.

Context

We develop clear criteria for potential target companies using broad performance metrics to narrow the search. We build recommendations through valuation and in-market conversations about the feasibility of a successful acquisition. This 2-minute survey will help us understand where you are in your process, and how our Target Screening offering could potentially help.

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