Pro-forma adjustments occur when the company has made recent acquisitions or divestitures. For example, capital expenditures may not be accurate because the company could have ordered a lot of equipment but have yet to pay for the purchase, which results in a payment post-acquisition, thus affecting the total cash available after the deal.
The benefits of buying to sell in such situations are plain—though, again, often overlooked. We then consider how those strategies are related to firm founder characteristics.
Similarly, in a manufacturing business, data analytics could manage the flow of ingredients on the assembly line to minimise waste and aid automation processes that can predict when a piece of production equipment is likely to need maintenance.
A strategy of flexible ownership could have wider appeal to large industrial and service companies than buying to sell.
Under their previous owners, those businesses had often suffered from neglect, unsuitable performance targets, or other constraints. They are renowned for excellent financial controls and for a relentless focus on enhancing the performance basics: revenue, operating margins, and cash flow.
Our research seeks to fill that gap. What is the concentration of your top 50 customers? When KKR and GS Capital Partners, the private equity arm of Goldman Sachs, acquired the Wincor Nixdorf unit from Siemens inthey were able to work with the incumbent management and follow its plan to grow revenues and margins.