Consistent approach. Consistent results.
See these case examples to learn how Grob Partners works with clients and see the results that work generates.
Case 1: Investment Due Diligence
Business services - driving bid price down $25 million through pinpoint diligence
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An investor retained Grob Partners to assess a possible strategic acquisition. Though the target could potentially provide attractive synergies to Grob’s client across its customer base and production footprint, the target’s performance suggested deterioration; it was also known to be close to a large debt package default.
The client’s investment bank pushed an offer price of $135 million after completing its high-level assessment of management’s data and presentation.
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Grob Partners, with Jay Grob working solo, focused its efforts on three fronts:
The target’s likelihood to meet its revenue forecasts
Synergy value across the two business’ customer bases and production footprint
The lenders’ options in a default
Through expert discussions, detailed customer research, and production cost assessments, Grob developed a point-of-view on the target, its prospects, and the potential synergies between the two businesses. The work confirmed that the two were more valuable together than apart.
By reaching out to a cross-section of industry lenders to handicap lender behavior, it became clear the lenders’ options were close to zero. No other buyers that made sense, a looming bankruptcy, and likely customer and employee defections. Any lender that could save some value would be doing great work.
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Working with the banker and the internal client team, Grob’s analysis suggested an offer price of $110 million and to hold tight at that level as the lenders pushed back. The client offered that amount and closed the transaction 60 days later.
Case 2: Strategic Operating Plans
Niche business insurance – from flat growth to 8x return
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A private equity-owned niche insurance business had a longtime leadership position and strong management team serving clients in a highly specialized construction segment. But growth had slowed to a trickle and efforts to move into nearby segments had proven difficult.
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The private equity owners asked Grob Partners to work with company executives to build the go forward roadmap. The Grob team, using Jay Grob and a full-time consultant, looked closely at both the current core and potential adjacency expansion opportunities. With management providing access to key channel partners, Grob assessed the portfolio company’s addressable market, the power of its value proposition and the economic leverage points in the business.
The work suggested that the business’ leadership position was more defensible with more room for growth than previously thought. Their products’ risk-management features delivered differentiated value to customers, key channel partners had untapped potential for new clients, and new product and cross-selling opportunities existed.
The research also clarified that the company had work to do to better serve channel partners and to put those partners in the best position to sell and serve the insured base. In addition, it appeared that it would be challenging to build the same strong position in the expansion segments.
Grob assisted the client team to build the plan; they re-organized to better focus on the channel partners, increased investment in the risk management features, and restructured internal and external incentives to capture cross-line selling opportunities. They also backed off incremental investment in the adjacencies.
Over the next several years, Grob continued to support the business as needed. Jay Grob joined the Board of Directors, helping to assess progress, adjust the plan and manage the company’s sale.
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Over the next several years, the portfolio company’s premium base grew from $50 million to $150 million with corresponding margin growth. In 2021, the private equity firm marketed the business and sold it for 8x return on equity.
Case 3: Merger integration
Oilfield Services – Building an integrated “sale-ready” operating business
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A private equity firm and one of its portfolio companies retained Grob Partners to help integrate two oilfield services businesses in the world’s busiest oil basin. Though the PE firm had owned the two companies for over a year, management delayed integration due to overwhelming demand in the region and concerns about employee retention. Private equity ownership, however, intended to sell the combined assets as soon as realistically possible and assigned management to make that integration happen.
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Grob Partners, staffing Jay Grob and a highly experienced program management consultant, concentrated its efforts in three critical areas:
Protecting the base business during a highly lucrative but uncertain time
Retaining the employee base
Establishing a functioning and sale-ready Go Forward operating company
Jay Grob worked closely with the CEO to resolve organization, people, and power issues essential to moving forward. The Grob team established an integration management function and structured process to manage complexities of the integration across two companies with hundreds of employees, dozens of locations, thousands of job sites, and substantial corporate support functions.
Although there were twelve cross-company teams pushing forward, the structure and support allowed most of the executive team to manage the daily business. The twelve teams, with Grob’s guidance, did the core analytics and planning that would bring the companies together. They then executed those plans.
The integration management function drove the change and communication processes to keep honest information flowing about the merger; it also developed and executed tailored, systematic messaging to the key employees and other stakeholder groups.
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The client now operates as a single entity and there was virtually no turnover in the employee base.
Case 4: Business Transformation
General contracting – Reinventing sales and operations for customers and the internal team
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A large, private contracting business asked Grob Partners to help drive a major transformation. The aspiration centered around a new business approach that would fundamentally change relationships across sales, account management, and operations to improve customer satisfaction, reduce redundant work, enhance accountability and increase margins. This business re-invention would impact over 5,000 people across the US in 30 branch locations, dozens of offices and hundreds of job sites.
A major strategy consulting firm had completed a diagnostic; client leadership respected that work. The firm proposed implementation support, but the executive group had determined that the proposed approach did not adequately address their timing needs and bandwidth limitations. They also found the price far too high.
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Grob Partners built a five-person team to guide the transformation. That Grob team included:
Jay Grob working full-time with client and program leadership
A program management and change management consultant expert at managing complex efforts requiring structure, process, risk management, communications and reporting
Two former Bain consultants adept at core business and financial analytics
A process and information technology consultant to manage key information-related issues
The Grob team worked alongside over 100 client staff across six teams who spent some or all their time working on the engagement. As the contracting business seasonally ebbed and flowed, Grob worked with the client on strategies to build flexibility for staff who needed time for their own customers as commitments peaked.
Over the first phase, the teams assessed dozens of opportunities. Each team prioritized its own, and cross-program tradeoffs were evaluated. A comprehensive program plan laid out timing, risks, metrics, and change priorities. Three critical initiatives got the green light to move forward; others were put into the “parking lot” for later; the client dropped the rest from consideration.
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The work resulted in considerable improvements across the enterprise and improvement of $12 million annual run-rate margin improvement, generating full payback in 2 years.