Value Proposition

Using digital tools in transaction projects in the Health Industries enhances the speed, accuracy, security, and compliance while reducing costs and providing valuable insights.

By leveraging these tools, Health Industries organizations can streamline their transactional workflows, improve operational efficiency, and ultimately increase the success rate of M&A projects in Health Industries.

Digital and data-driven tools are key to generate insights and increase success in M&A transactions that are becoming more complex

Introduction

Key Observations

As the amount and volume of data being shared throughout the M&A process increases, due diligences have become more complex and time-consuming.
At the same time, collecting and providing data to (potential) bidders has become a time-consuming exercise.
The average time to close an M&A deal has increased by more than 30 percent in the past decade1.
Likewise, the time required for due diligences has become longer compared to five years ago2.

Our Hypothesis

Utilizing digital tools in the M&A process will increase the likelihood of deal success as they provide more insights and better analyses of available data and generate faster results while reducing efforts and possibilities for human errors through standardization and automation.

Our Hypothesis

Using Artificial Intelligence to analyze vast amounts of data in a short period of time, i.e. screening a VDR within minutes.
Reviewing and analyzing contracts with natural language processing to identify party names, change of control or termination provisions.
Employing interactive data visualizations to allow more detailed and comprehensive interpretation of data. Drilling down data at the tip of your finger will provide exactly the insights you are looking for.
Project management tools help coordinate interdependencies between a vast amount of activities and milestones across a large team.
Targets scouting tools will narrow down the list of potential targets based on selection criteria according to the defined acquisition strategy.

Source: 1) Refinitiv data 2) PwC Deals intelligence

The availability of more powerful technologies, combined with an explosive growth of data and the hunger for greater levels of information are the drivers of digital tools in Deals

Digitalization developments and trends

Businesses are producing more data from new sources

Businesses are increasingly collecting and organizing more of their data.
Increased volumes of both structured and unstructured data.
Proliferation of externally curated incremental data sources easily available.

Accessible technology is developing rapidly

Technology continues to advance while becoming more accessible to business users.
Further investments are made in expanding the tools for business, such as cloud based solutions, while at the same time costs are declining.
The cost of storage and computing power continues to fall.
AI & Machine Learning is becoming democratized.

Processes are competitive and investors expect transparency

More granular insight is required.
Greater substantiation of the equity story to support pricing.
Management is expected to understand and leverage all of their data.
Faster, more precise responses is demanded.

Deeper insights expecting to drive value creation

Analytics are increasingly becoming real time, on-demand and available anywhere.
Solutions are more self-service-driven and owned by the business, not IT.
Scalable analytics infrastructure, fully integrated with existing systems.
Predictive analytics increasingly expected to support decision making.

Your journey is our journey, as we are in the middle of a transformation ourselves

Our Digital Story of upskilling 284,000 people

We’ve reoriented our firm’s identity around the Digital experience

Our Digital Story timeline of upskilling 284,000 people

In our PwC Deals approach, analytics shape all phases of a project as an integral part of both our service delivery model and a proven cornerstone to deliver deal value

The PwC Deals digital approach

Preparation

Data requests are likely to involve raw ERP system extracts, taking data from multiple sources and in different formats.
PwC can support this process, significantly reducing data-gathering requirement.
Secure data transfers rather than emailing Excel files.

Engagement

A single source of truth approach with centrally stored data model(s) can support multiple project workstreams. Reducing the likelihood of errors, significantly decreasing data refresh times, frees up time for the teams to use the data to generate more insightful views.
Different levels of “sophistication” of analysis carried out: diagnose (what happened), predict (what will happen), prescribe (what should we do).
Work carried out using an agile approach.

Deliverables

Dynamic and interactive deliverables rather than static reports, for example, dashboards and cock-pits that can be used to monitor and to drill down.
Future-proofed tools and models that can be refreshed with new data, and algorithms that continue to learn and refine as more data is made available.
Based on technology that is scalable, and that can be integrated with existing IT infrastructure.

Post-engagement

Opportunities for automation offer for example data refreshers.
Existing deliverables can be adapted to post-deal activities (dashboards can become synergy tracking tools etc.).
Follow-up on value-add opportunities identified throughout the engagement.

In our typical PwC Deals project workflow, more insights and better analyses of available data generate fast results while reducing efforts

The PwC Deals workflow

Manage Data

Collecting, consolidating and cleaning internal/ external data

Common data model

Web scraping

API connect

OCR

Modelling

Applying predictive algorithms to uncover insights from data

Regression Modelling

Classification Modelling

Natural language understanding

Process mining

Visualization

Converting the data into tangible and user-friendly dashboards

Interactive dashboards

Enabled self exploration

Tableau, Power BI, R-Shiny

Harness insights

Applying the insights into more effective decision making

Simulation analysis

Optimization

Recommender engines

Reinforcement learning

Our portfolio of fully adaptable digital tools covers the entire deal cycle and any deal situation

Selected tools in Deals

Due Diligence

Common Data Model CDM
Deals Benchmarking tool
File Compare Selector Changer
Queen: Connected Analytics
eValuation
Pandemic Analysis and Scenario Simulation PASS [Impact Covid-19 on capital ratios]
AI driven customer, product and branch analytics
Outside-in.App
Interactive Reports
Data scraping tool
Social media analysis

Carve-Out

RAPTOR
ERA Exit Readiness Accelerator
Process mining and analytics
Value Flow visualization, ABC analysis and customer analysis
Carve-Out financials Model
Production planning & regulatory submission optimization
Information request processing
Advanced Carve-Out analytics

M&A Integration

M&A Integration Integrated Solution
PMI2GO
PowerBI Synergy Tracker
Connected Contract Analytics
TMT Value Lever Tool
Clean team data cubes
CulturalWizard
DFA
Qualtrics

Value Creation

Midaxo
Mural
Miro
Amplify
Wonder
Foleon
Jedox IT OTC Estimation
Geospatial.App
Predictive Analytics Services (PAS)
Fit for growth (S&) Benchmarking tool
GDA Benchmark Database
Saratoga (HR Benchmarking)
Rapid Value Identification
Board Level Insights

Selected technologies and platforms used in PwC Deals

However, realistic limitations have to be considered for planning your digital deals, and managing the expectations of all stakeholders

Limitations

The quality of the input is directly related to the quality of the output.

While data cleansing remains an essential step in many cases, the efforts required to get the data in shape must not be underestimated and have to be factored in realistically.

While there is often far more information in data than expected or visible at first, every analysis is limited to the data behind it.

A clear expectation setting and understanding of the potential outcomes and its limitation remains essential to steer the use of digital tools to ensure capturing true value.

Leveraging digital solutions in deals will to a large extend not create a competitive edge anymore, but rather helps to drive and keep up with M&A developments and to interact on an equal basis.

Benchmarking deals, the achievable values and the required efforts, a consequent use of state-of-the-art tools has become the essential foundation for securing and harvesting optimum deal value.

Even the most sophisticated solutions based on artificial intelligence still require human efforts for setup, intervention, and reading the results.

Account for both the required resources to perform the required tasks, and consider the “human factor” in every exercise, including set-up, training and testing.

Leveraging digital tools will require a change in the overall project structure, team setup and skillset

Synopsis

Distribution of skills and roles along a deal

Summary

Setting up data models and the required data structure based on the transaction strategy requires an upfront investment.
Your functional experts and data owners will be more involved to provide the right data in the right structure.
With heterogeneous IT landscapes and data sources, cleansing and maintenance of data will be required to enable and maintain the „one source of truth”.
Structured due diligence management will enable the involvement of more functional experts to provide opinions and interpret analyses without influencing overall transaction management.
Decision making through interpretation of results and analyses can only be performed by humans.
Leveraging available digital tools will have a significant positive impact on your future deals by optimizing the quality of deliverables, revealing great insights and increasing the speed of transactions.