35%
Downside risk to 10-year profit projections
Technical and Operational Due Diligence Identifies 35% Downside Risk and 15% EBITDA Upside
A global investment fund evaluated a joint venture opportunity with an established battery manufacturer expanding into the US market. Together, we assessed operational readiness and cross-border technology transfer capabilities. The comprehensive due diligence process equipped the fund to prepare a competitive bid with clear value creation strategies.
Industry: Automotive and Commercial Vehicles
Industry: Private Equity
Service: Digital & Ai
Service: Manufacturing
Service: Operations Strategy and Transformation
Service: R&d and Product Profitability
Service: Supply Chain
Service: Transactions and Turnaround
Our Client
A global investment fund targeting green technology opportunities sought to partner with an established EV battery manufacturer for US market expansion. The fund specializes in sustainable technology investments and was evaluating a joint venture to establish large-scale battery production facilities. This strategic move promised access to the rapidly expanding North American electric vehicle market through proven battery production expertise.
The Challenge
The investment opportunity presented complex operational and technical uncertainties that required thorough evaluation before committing capital.
- Cross-border technology transfer complexity: The Chinese manufacturer needed to transfer proprietary production know-how and process control to a US greenfield operation, navigating different regulatory environments and operational standards
- Unproven scale-up of new battery format: While experienced in battery production, the manufacturer had not previously produced the specific cylindrical battery format at scale, so validation of yield and ramp-up assumptions was critical
- Workforce and cultural integration risks: The US facility would need to recruit over 20% of the available workforce from a local labor pool while bridging cultural differences between Chinese engineering expertise and US operational practices
Real Results Achieved Together
The comprehensive due diligence revealed both significant risks and substantial value creation opportunities. Working with the investment fund's finance team, we provided insights that shaped the investment thesis and enabled informed decision-making.
15%
EBITDA upside potential identified
20%
of Local workforce to be recruited
Transformation Impact
- Identified critical mitigation actions in vertical start-up, yield attainment and labor utilization
- Enabled preparation of a highly competitive bid based on disciplined assessment approach
- Positioned the fund as a preferred partner through a robust value creation strategy
Our Approach
The project involved a blend of operational analysis, site visits and stakeholder engagement. We conducted an end-to-end assessment of the planned manufacturing setup, including process design, equipment layout, production flow and automation strategy. The team evaluated the proposed transfer of best practices and proprietary know-how from the Chinese production site to the US-based greenfield operation.
Our workforce and organizational readiness assessment focused on recruitment, training and integration plans, with special attention paid to key roles in production, quality, and engineering. We mapped the end-to-end supply chain with a specific focus on sourcing, logistics and North American supplier dependencies.
The team modeled scenarios for operational ramp-up, cost competitiveness and time-to-market under various risk parameters. Collaborating closely with the investment fund finance team, we provided inputs to assess downside risks and upside improvements for inclusion in the investment thesis.
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Facing Similar Manufacturing Investment Challenges?
- Evaluating complex cross-border manufacturing ventures with technical and operational uncertainties
- Transforming investment risk assessment into quantified opportunities for value creation
- Building operational excellence through rigorous due diligence and implementation partnership
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