Reflecting on a conversation I had on Moneyweb with Fifi Peters around the consortium angle on concluding deals, it seems like quite a few of the listed entities are offloading potentially non-core assets or higher value assets to pay down debt that they’ve accumulated over a couple of years through high growth phases pre-Covid. It’s quite an interesting dynamic to properly understand what makes up these consortiums.
The biggest challenge in our view and experience at Deal Leaders is dealing with multiple parties with multiple agendas (not necessarily in a negative way); how do you bring it all together? How do you get a coherent culture? How do you get a coherent deal strategy? And how do you get the existing entity to buy into that mix?
So, on many occasions, it seems the consortium model brings a whole new dynamic of challenges that need to be ironed out carefully and succinctly before any deals are concluded. And it’s about separating the qualitative, the quantitative, and the people components of what that successful deal needs to look like.
That’s why the right adviser and process/framework are so important to successfully navigate the complexity of a consortium deal. At Deal Leaders, we’re potentially looking at one or two consortium deals in our own portfolio. Our framework typically looks for a more targeted approach, with certain industries requiring a more creative slant.
Read or listen to the full interview here.