Business case
Our client, a PE-backed contract research organisation (CRO) specialised in the preclinical testing of medical devices on large animals, needed to reshuffle its shareholding structure.
Given the fixed-cost nature of the client’s business, COVID had a very significant negative impact on EBITDA. In addition, CROs are mainly driven by capacity, which corresponds to (i) the number of operating rooms, (ii) the quality of new technological equipment to equip them and (iii) the number and quality of veterinarian surgeons.
We prepared sell-side due diligence, which included an analysis of the historical profitability of the company and the impact of COVID on the business, as well as a critical review of the business plan and an assessment of the recurring profitability level through a quality of earnings analysis.