In 2004, J.W. Childs had the opportunity to acquire the Sunny Delight Beverage Co. (SDBC) through a unique carve-out of brands by Procter & Gamble. An accurate and in-depth assessment of the infrastructure required to support SunnyD’s business going forward would be absolutely essential to Childs’ decision to purchase the company.
The CompanyJ.W. Childs Associates, L.P. ("JWC") is a private equity ? rm based in Boston, Massachusetts. With a focus on building businesses, JWC seeks companies with suf? cient equity to support growth, and specializes in leveraged buyouts and recapitalizations of middle-market growth companies.
Since 1995, JWC has invested in companies with a total transaction value of over $8 billion. The ? rm currently invests through J.W. Childs Equity Partners III, L.P., an investment fund with total committed capital IT Due from ? nancial institutions, pension funds, insurance companies and university endowments of $1.75 billion.
Diligence
The Challenge Partnering with Private Equity In 2004, J.W. Childs had the opportunity to acquire the Sunny Delight Beverage Co. (SDBC) through a unique carve-out of brands by Procter Before and After the Sale
& Gamble. The deal was further complicated by the fact that the global A O N E N E C K I T S E RV I C E S C A S E S T U D Y marketer of juice-based drinks would emerge from P&G without any IT infrastructure of its own, only a costly transition services agreement from its former owners. An accurate and in-depth assessment of the infrastructure required to support SunnyD's business going forward would be absolutely essential to Childs' decision to purchase the company.
"J.W. Childs has traditionally looked at complicated deals as a way to differentiate ourselves in the market," said JWC Vice President Jeffrey J. Teschke. "Naturally, these types of deals require more ? rms like OneNeck with which to partner."
Teschke said the ? rm had worked with several large consulting ? rms for this sort of outsourced due diligence in the past. And while the large ? rms executed macro assessments that provided a decent look at the business, their ? ndings dealt mostly in big numbers.
Added Teschke, "Since we neither have the in-house expertise nor the time to do this kind of analysis, we chose to work with OneNeck rather than the larger ? rms with which we had traditionally worked."
For JWC, working with a ? rm such as OneNeck proved valuable in two key areas. First, OneNeck provided the kind of highly detailed IT and ERP analysis needed for the SunnyD assessment. Second, the private equity ? rm gained the bene? t of working with an outsourcing partner who could also deliver the required services indicated through the due diligence effort, making for faster ramp-up and implementation once the deal was completed. On the contrary, for the IT due diligence phase of the SunnyD carve out, "In the case of Sunny Delight Teschke and others at JWC were looking to ? nd the big trouble areas or Beverage Corp., OneNeck brought potential problems that might arise out of SunnyD's need to deploy its us a focused due diligence skill set own IT platform and complex ERP system in approximately one year. with proven expertise in complex ERP environments. Plus, OneNeck's The OneNeck Solution ability to provide outsourcing and OneNeck offered JWC two areas of core capabilities that they customer intimate relationships believed would be essential to an accurate IT assessment of SunnyD. First, because OneNeck comes from a background of running after the due diligence phase ended these environments, not merely assessing them, they're capable of were key attributes other ? rms understanding complex ERP environments and their relevance to overall simply did not offer." company performance. This high level of business acumen enabled Jeffrey J. Teschke, OneNeck to not only assess the technological aspects of continuing the Vice President, J.W. Childs Associates, L.P.P&G transition services, but to also look at SunnyD's total IT needs and advise JWC on post-purchase solutions.
Second, OneNeck was unique among the ? rms under consideration by JWC in that they have the capabilities to provide IT outsourcing - on any scale - for every application needed by SunnyD. Additionally, OneNeck's services are delivered through a customer intimate model that emphasizes close working relationships with the customer. This was an important factor to J.W. Childs, given the almost-impossible deadlines for implementation facing the management at SunnyD.
As a result of the ideal ? t between J.W. Childs' needs and OneNeck's capabilities, the private equity ? rm engaged OneNeck to perform an Information Techno... [download for more]
