Leading an Issue-Free Day One for a Major Divestiture

Financial Services

A world leader in consumer transaction technology was going through a business reinvention designed to transform the organization from a hardware manufacturer to a provider of software solutions enabled by hardware.

A Transformation Case Study

CHALLENGE

A world leader in consumer transaction technology was going through a business reinvention designed to transform the organization from a hardware manufacturer to a provider of software solutions enabled by hardware. As part of this strategic undertaking, the company’s leadership decided to divest its printing division, creating a new entity that would operate as a stand-alone business in a private equity firm’s portfolio.

The split, which would affect hundreds of employees moving to the new organization, had several major logistical and legal complications. The printing division relied heavily on shared services across the larger organization’s global footprint, so the divestiture would require transition planning across dozens of countries.  In addition, each of those countries had its own regulations and processes with which to comply. The new entity had the potential to continue to be a leading provider of labelling and receipt solutions, and it was critical that it be positioned for success under its new ownership.

“This was a very complicated project, as anyone who came within 10 feet of it can tell you, but the expertise and operational support North Highland provided was absolutely critical to our success.
-VP of Corporate Development


SOLUTION      

The transaction technology company turned to North Highland, with which it had an ongoing relationship, to facilitate the divestiture process. North Highland assembled a lean team of Merger and Acquisition experts to act as guides throughout the project and drive results. This allowed the organization to be involved in the process and own its own change – an experience that would help both companies continue to operate successfully after the split. North Highland also played a critical role in facilitating discussion between stakeholders and enabling the company’s different divisions to act as a single team until the day of close. 

Acting as the organization’s project management office (PMO), North Highland provided leadership for transition and Day One planning, and also for execution—from due diligence to the definitive agreement and the closing of the deal. In this project management role, which required the ability to navigate challenging clients and regulatory hurdles around the world, North Highland worked with stakeholders to define the operating model, including individual functions, and create a blueprint and process flows to support teamwork. They designed a comprehensive Transition Services Agreement (TSA) that was a key foundation for the carve-out process – it laid out rules, policies, and legal lines of separation as well as the formal operating structure. North Highland also established weekly meetings to discuss progress and keep leadership and workstream leaders apprised of developments. 

Planning and execution of Day One allowed the organization to decide what the new structure would look like, from the first 24 hours of divestment and onward. The official hand-off process was defined in advance to give everyone involved a high level of confidence in how activities and processes would work from the moment of transition on.

The international nature of the printing division’s operations was the largest obstacle to smooth transition planning.  With the original organization spread across more than 40 countries, North Highland guided the discussion of how and where to carve out the printing division. The first phase closed with 19 countries, each of which had its own set of challenges and regulatory hurdles to overcome.

I especially appreciate the ability and willingness of everyone on the North Highland team to roll up their sleeves and jump right on in alongside us to move our colleagues along – they really got to know our group, and it felt very much like one team throughout the process. I feel like I know how things work around here much better than I did before we started this project!” -VP of Corporate Development

RESULTS

North Highland’s efforts delivered an issue-free Day One, enabling an uninterrupted flow of commerce for the new printer solutions business. Thorough planning led to a well-coordinated transition, with 860 employees supported in their move to a new organization and 19 of 24 countries closed in a single day.  Leaders on both sides had been clearly briefed on expectations and needs, and team members at all levels had the appropriate resources to keep operations running seamlessly.

As a result, the printing services company was able to hit the ground running with its new private equity owners while continuing to maintain a commercial relationship with its previous owner.  

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