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    Case Study

    Carlyle Group and the AZ-EM buyout (A2): Due diligence

    By Benoit F. Leleux, Balaji S. Chakravarthy and Jonathan Lachowitz
    9 pages
    September 2009
    Order this case study
    Reference: IMD-3-2047

    Private equity managers are asked to make some of the most complex and gutsy investment decisions. Before any deal is completed, an information gathering and analysis process called due diligence is conducted to assess both the future upside of the potential investment and the possible downside. The Carlyle Group was known as one of the most data-intensive private equity investors in the industry. Carlyle’s due diligence process in assessing the AZ-Electronic Materials (AZ-EM) deal was typical of its rigorous approach. The due diligence process was significantly outsourced, with outside specialists hired in key administrative and operational areas and given very specific instructions by the private equity team. The due diligence conducted to evaluate AZ-EM was particularly intensive because the deal was a carve-out where the accounting and operational records had to be disentangled from those of the parent organization (Clariant). It was orchestrated by Robert Easton and Zeina Bain. The expanded team included not only members of The Carlyle Group and its operating companies, but also Ken Greatbatch, a carve-out specialist, and some 100 other external advisors from Clifford Chance, PwC, A.T. Kearney, ERM, Aon and Accenture. Additionally, UBS, the investment banker, was involved as the potential arranger and syndicator of the debt financing.

    Learning Objective

    Buyout, due diligence, managing transition, turnaround management, leverage, incentives, restructuring.

    Keywords
    Buyout, Private Equity, Turnaround, Leverage, Electronics, General Management, Strategy
    Settings
    Switzerland
    Manufacturing, Chemicals
    2004-2009
    Type
    Field Research
    Copyright
    © 2009
    Available Languages
    English
    Related material
    Teaching note, Video
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    This case study is part of a series
    • Carlyle Group and the AZ-EM buyout (A2): Due diligence
    • Carlyle Group and the AZ-EM buyout (B): Value creation after the transaction
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    Carlyle Group and the AZ-EM buyout (A2): Due diligence
    By Benoit F. Leleux Balaji S. Chakravarthy and Jonathan Lachowitz
    Case reference: IMD-3-2047 ©2009
    Summary
    Private equity managers are asked to make some of the most complex and gutsy investment decisions. Before any deal is completed, an information gat...
    Read more
    Reference IMD-3-2047
    Copyright ©2009
    Copyright owner IMD Copyright
    Industry Manufacturing, Chemicals
    Available Languages English
    Contact

    Research Information & Knowledge Hub for additional information on IMD publications

    Related topics
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    Available Languages English
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