Joint Venture Consulting and Advisory

How Due Diligence Differs for M&A and Joint Venture Deals

JOINT VENTURE AND M&A due diligence are superficially similar. Both follow the same basic process, starting when a preferred counterparty is identified and confidentiality agreements are signed, and usually concluding just prior to the signing of definitive agreements. Both use similar advisors to investigate ...

Valuation of Joint Ventures: 4 Steps to Handling Hard-to-Value Contributions

COMPANIES ROUTINELY FIND themselves in painful joint venture negotiations, reaching “walk-away points” and failing to close deals because of hard-to-value contributions, differences in key assumptions, or valuations that do not support the desired ownership or control split. Relief lies in a paradox: While ...

Strategy Under Scrutiny

IN MANY JOINT VENTURES – including those in semiconductors, financial services, media, healthcare, and natural resources – the owners are also the JV’s customers, channel, suppliers, users, or otherwise actively participate in the same markets as the venture (Exhibit 1). Intel, Samsung, and AMD all own ...

Financial Modeling for Joint Ventures: The Total Venture Economics Approach

EARLY RESULTS OF OUR recent study on how companies perform across different aspects of the JV dealmaking process has revealed fairly pedestrian performance all around, with critical gaps across key functions within core JV transaction workstreams. With respect to financial modeling, for example, we find that ...

Corporate Social Responsibility in Non-Controlled Joint Venture Assets: Why Corporate Boards Should Care

LAST YEAR, WE wrote about why corporate Boards of Directors should care about their portfolios of non-controlled joint ventures. In short, these portfolios tend to be more material than realized, carry underappreciated and often inappropriately managed levels of risk, and contain latent performance upside – ...

Outgoing JV CEOs: Should They Transition to a Role on the JV Board?

RECENT STUDIES SHOW that more than 50% of outgoing public company CEOs retain a formal role on the company’s Board of Directors¹. In contrast, our analysis of 112 joint venture CEO transitions reveals that 15% of outgoing JV CEOs transition to a formal role on the JV Board². Should more joint ventures ...

Silent But (Potentially) Deadly: The Power of the Status Quo in Joint Ventures

JOINT VENTURE PARTNERSHIPS have a significant say in the structure, actions, and strategy of a venture. Management also has a voice in the direction of the joint venture. But what partners and management often fail to understand is there is another, silent party at the table influencing the outcome of key ...

Making Alignment Real in Joint Ventures: Board Concurrence, Minutes, and the Post-Meeting Memo

IT MAY BE AS DRY AS unbuttered toast but chew on this: Experienced JV CEOs use a variety of seemingly mundane pre-, post-, and within-Board meeting techniques to drive real, rather than perceived, alignment across their ventures. Our research has consistently shown that misalignment – whether among the owners, ...

Shareholder Stewardship of Joint Venture Employees: Opening the Aperture

TENS OF MILLIONS of people are employed in joint venture companies around the world. In many cases, these ventures are partly-owned by large national and international companies. Today, Siemens, IBM, Royal Dutch Shell, General Motors, Airbus, and Nestle each have ownership interests in joint venture companies ...

Water Street Partners advises clients on transactions and governance. Our transaction work specializes in joint ventures and other non-M&A partnerships, both in new deal formation and restructuring. On governance, we advise clients on corporate and joint venture governance, working with corporate and joint venture boards, management teams, and individual shareholders. We support clients around the world and across industries.

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