Case Study

Alex de Werra at TCFG - The kermel mandate

6 pages
December 2003
Reference: IMD-1-0204

In April 2002 Alex de Werra, director at TCFG, was contacted by a fellow alumnus of IMD for advice on a possible management buyout of Kermel, a French textile company. Although De Werra handled this kind of transaction routinely, this mandate was very challenging. The vendor was in a rush to sell and De Werra had less than two weeks to convince a private equity (P/E) investor to submit a competitive bid. This case illustrates the key role played by M&A advisory firms in engineering P/E transactions. It also addresses the major dilemma they face in purchase mandates wherein they have to protect the interests of the management team but are often compensated by the P/E firm. This case is interrelated with two other cases that focus on the other actors of the deal: Venkatesh Tulluri, who took the decision to engineer the MBO and would become Kermel’s CEO, and Argos Soditic, the PE investor.

Keywords
Management by Objectives, Merger and Acquisition Advisory, Private Equity, Valuation
Settings
Switzerland
April 2002
Type
Field Research
Copyright
© 2004
Available Languages
English
Related material
Teaching note, Video
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