Our investment process consists of working closely with the management team to determine how best to build value for the company. While no two transactions are identical, we generally take the following steps when making an investment:
Initial contact and preliminary screening
Using our expertise and industry network, we are able to rapidly assess the fit of a business proposal.
Due diligence and investment strategy definition
Assuming both parties wish to proceed, we submit a term sheet which includes key elements of the deal structure. Once an agreement in principle is achieved, we engage in an efficient due diligence effort, often aided by professional firms for legal, tax, accounting, market and environmental reviews. In parallel, we work closely with management to formulate the investment strategy going forward.
Investment strategy execution and monitoring
Once a transaction is closed, both Cadent and the management team seek new opportunities to enhance the company's value. Such opportunities may include making accretive acquisitions or expanding into new markets or locations. Cadent maintains regular contact with management, is active at the board level, and provides feedback and assistance. Our expertise, skills and access to industry relationships are always available to our portfolio companies.
Careful and early planning of the exit is crucial to ensure maximum returns. Options are continually evaluated and the company's strategy is often directed toward building a business which will be highly valuable to a number of strategic and financial buyers.
Cadent will assist the management team with respect to a company sale, initial public offering, leveraged recapitalization or other exit transaction. By the time Cadent exits the investment, we will have developed a strong relationship with the management team, which in the past has often resulted in backing the team's subsequent ventures.