Case Study: Asset Divestiture

Challenge: How to extract value from an unprofitable business, while improving the customers’ value proposition.

Action:

• Developed the market study and pro-forma financial model that supported the asset divestiture decision. Used Discounted Cash Flow (DCF) analysis to clarify existing market potential and unit’s true bottom line contribution.
• Negotiated bilateral asset sale and marketing partnership. Developed “win-win” purchase structure that allowed both concerns to derive significant value.
• Provided transition planning and support.

Result: Locked in contractually guaranteed 5-year revenue stream, which fell directly to the bottom line, and generated $19 million in cost savings. Customers gained a smooth upgrade path and enhanced support.