How does Avallon conclude investments with VDR?
What will you find in this article?
Avallon Fund has carried out over 100 management buyouts in its twenty-year history. The fund is primarily involved in projects initiated by managers, focusing on effectively increasing the value of their companies. Avallon helps all parties achieve transactional success – as a result, owners can be sure that their company will be in good hands, and the new executives take over a business they know well. Both in the investment processes (including MBO, LMBO) and divestments, the fund uses the FORDATA Virtual Data Room system. How do we help Avallon conduct these processes more efficiently?
OUR CLIENT
Avallon Private Equity Fund, a pioneer on the management buyout market in Poland
SCOPE OF COOPERATION
Several transactions carried out on the Polish market since 2010
TRANSACTIONS TYPE
MBO and LMBO investments (including Novo Tech, MPS Holding, Norlys)
Exits from investments (including sale of Good Food to the Resource Partners fund)
01 THE CHALLENGE
Due Diligence is a necessary stage of every investment process. Its role is to subject the company to an in-depth analysis in order for it to be valued by the investor. Due diligence involves specialists from many independent companies, often geographically dispersed. Usually, 20 to several dozen specialists from several independent companies are involved in the transactions. In the course of the audit, the company that is the target of the transaction provides investors with sensitive information that may affect the company’s future competitive position. The amount of this information may not be large, but its protection is absolutely critical.
Avallon was looking for a technological partner who would provide a solution to conduct Due Diligence in a safe, organized and comfortable manner.
On the other hand, efficient organization of Due diligence lies in the interest of every person and company involved in it. Avallon saw these needs over 10 years ago. That is why the fund was looking for a technological partner who would provide a solution to conduct Due Diligence on-line in a safe, organized and comfortable way for all its participants. In addition to a reliable system, it was important for Avallon to find a company that works in accordance with similar values based on trust, partnership and honesty.
02 SOLUTION
FORDATA became the technology partner preferred by Avallon on the first transaction made with the use of VDR (sale of Good Food to the Resource Partners fund). Due to the fact that Avallon takes on various roles (sometimes it is the seller, sometimes it is an investor), we have signed a VDR contract with the target company each time. However, we have used our experience to properly determine the size of the VDR instance, or the time needed to make the VDR available and close the process.
An independent data room is launched for each transaction, in which the target company provides investors and their advisers with documents subject to due diligence. Access is possible onlnie, 24/7 from anywhere, and it is strictly regulated and supervised. Only the persons authorized by the administrator on the part of the owner / managers can view the documents. The target companies and the fund (if it is the owner) have full control over the course of the process thanks to user activity reports.
After each process has ended, FORDATA creates an encrypted physical VDR archive that comes includes all user activity reports. If the transaction is successful, the archive becomes an attachment to the investment agreement.
03 BENEFITS
Investments (including MBO, LMBO)
- Peace of mind - certainty for the owner that no unauthorized person will learn about the ongoing process and that no document will go where it should not
- Convenience - the ability to view documents on any device, clear structure, and simple granting permissions
- Support - dedicated project supervisor, 24/7 availability, responsiveness in 15 minutes by e-mail and 15 seconds by telephone
Divestments
- Control - knowledge on which user looks after which data, when, and where. Having granted access, the administrator can revoke it at any time with one click
- Speed - an efficient VDR system, both technologically and in terms of ease of use, combined with customer support, which allows to reduce transaction time and costs
- Range - increasing the possibility of reaching more investors, regardless of the time zone
FORDATA has provided our company with a comprehensive solution that is convincing with both its functionality and the ease of use. The advantage of the VDR platform is a high level of document security, guaranteed by the unique system of granting access to files. We recommend it to anyone who appreciates high quality and is looking for proven, innovative business solutions.
Case study powstało we współpracy z firmą Avallon.
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