Acting as an expert observer on the board

Challenge

A private equity (PE) investor was looking for a partner to be retained as an observer on the board of a regenerative medicine/advanced wound-healing company.

Solution

Because of his industry expertise, and strategic understanding gained through a long association with companies in similar stages of development, our consultant contributed to the board of director discussions. He was also able to draw on the experience of our other consultants during these meetings and over the course of this long-term assignment we were also asked to:

  • develop a valuation of the company based on analysis of comparables (albeit very few relevant examples available), a review of a discounted cash flow analysis and general market valuations for life science companies outside the field, but at a similar stage of corporate evolution. This required specialist expertise in the company‚Äôs technology and a deep understanding of valuation as applied to a company at this stage of development
  • update our original due diligence report, written 30 months before, assessing the degree to which the new management team had achieved the planned strategic and operational transformation of the company. We were able to make an objective and accurate assessment because our partner understood the challenges and realities of managing a company to deliver results. This was presented to the private equity investment committee as a core part of its exit decision
  • identify and assess corporate milestones over the coming 12-24 months, highlighting those that could underpin value inflection points and others of strategic significance. Once again, this activity relied on our partner having real industry experience in senior management roles.
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