Industry expertise to support preparation for transaction
A due diligence is essential for any transaction to help a potential buyer build a complete picture of the target company. A due diligence requires a deep dive into several facets of the target, such as financial, tax, commercial, IT, technical and organisational details. Typically, completion of a due diligence process requires specialised expertise in each of the areas in order to assess the status of the target. For a mobile network operator acquisition, it is important to include both technical and commercial expertise of mobile networks to better understand the opportunity. It is of even higher importance now when the mobile business is in transition to the 5G era with more and more demanding data services. Industry expertise is needed to assess the requirements for the 5G transition and the level of required investment.
Technical assessment of mobile network assets and operations
A technical due diligence focuses on the productive and strategic value of mobile network assets; their current status and especially their suitability for achieving future business objectives. For any acquisition of a mobile network operator, it is important for the potential buyer to understand:
- The key assets, such as the target company’s spectrum holdings and mobile network equipment, the essential sources of competitive advantage
- The current status of the mobile network and how it compares to competition
- Future outlook, impact of the target's strategy and past decisions on current and future competitive position
- Investment projections, how the planned investments enable the target company to achieve their business objectives
- Technical repercussions of legal findings, including operating and spectrum license obligations, as well as key supply and support agreements.
- Critical functions in the technical organisation and potential competence gaps resulting from separation from previous affiliates after the transaction
- The need for transition support from previous owner, in case separation of business-critical functions, systems or agreements will be required
Validation of investment plan and company valuation
The technical due diligence findings feed into the potential buyer's business case calculations. Typically, the technical due diligence validates and adjusts the need for investments in the mobile network and spectrum assets, i.e., how to make the target fit for meeting the expected market demand. A competent technical team can investigate the target's investment plan and provide an independent assessment of required investments to meet the future network targets. The technical due diligence provides the potential buyer with important insights into the target’s production engine to enable a justified valuation of the target in preparation for making a bid for the operations.
Omnitele is specialised in mobile network technologies and the operational mobile operator activities. Omnitele consultants have experience from several different markets, and operators in different positions in their respective markets, as well as in different levels of maturity when it comes to technical advancements. Omnitele has supported several customers, including investors and mobile operators alike, in due-diligence investigations and building business cases for mobile network operations on three different continents.
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