New technology and risk management practices offer substantial value
From initial due diligence to post-closing integration, a specialized insurance risk advisor who is fully integrated throughout each step of the M&A process can add significant value to the overall deal. At Hylant Private Equity/M&A, our M&A offering begins with a quantitative risk analysis to measure and assign an economic value to the exposures and liabilities of a target company. This proprietary process was built on new technology that goes considerably deeper than a standard insurance review conducted by a typical insurance broker or audit team.
The quantitative risk analysis quantifies the current and future value of liabilities and identifies hidden risks and expenses that are routinely overlooked.
- For buyers, this level of detail serves as additional leverage toward a more favorable closing and paints a complete risk picture for investors.
- For sellers, the analysis can identify weaknesses that might require attention before a company opens its books to prospective buyers.
If the quantitative risk analysis reveals particularly troubling issues, Hylant can structure deal facilitation coverage. This is a tailored insurance policy designed to transfer risk from a specific sticking point, such as successor liability or intellectual property liability, to a third party. This unique structure can move a deal past points of contention and put negotiations back on track.
After a deal closes, the process continues through insurance restructuring. Greater economies may be gained from the elimination of redundant policies, consolidation of coverage, repricing of policies and appropriate self-assumption of risk. The quantitative risk analysis serves as a blueprint for identifying and capturing key risk management efficiencies.
By having the quantitative risk analysis performed before the merger integration, Hylant can begin restructuring insurance programs more quickly and efficiently.
Throughout the next few weeks and months, we will delve deeper into the risk management strategies that support mergers, acquisitions, divestitures, public-to-private partnerships, commercial loans and structured financial transactions.
For more information, contact your local Hylant representative or Kip Irle, leader of Hylant’s Private Equity Practice at 312-283-1339 or firstname.lastname@example.org.