Cinven helps successful, high-quality companies move to the next phase of their growth, drawing on the expertise of our six sector teams using our proven value creation strategies. Many of the companies we invest in require injections of capital or management expertise; others need to restructure their operations to improve efficiency, or take on greater scale to help them compete in global markets. In our role as directors and controlling shareholders we frequently strengthen management teams - sometimes by bringing in additional managers with specific skills - or change the reporting structure to increase focus and accountability.
At Cinven, we aim to create real growth in the businesses we acquire. We use EBITDA* to measure our success, because it captures changes in company revenues and profit margins.
*EBITDA: earnings before interest, taxes, depreciation and amortisation.
While we may consider other options, the main value creation strategies Cinven applies, often in combination, are:
- focus on the core business: redirecting the company's resources to focus on its strengths;
- business roll-out: further growth and development of the business in its existing markets;
- industry consolidation: acquiring and merging related businesses to strengthen their competitive position;
- strategic redirection: refocusing the business strategy to benefit from changing market trends; and
- new market expansion: seizing opportunities presented by the opening up and development of new markets, particularly in Asia and emerging markets.
Cinven is a catalyst for change. After an acquisition is completed, we review the business with the management team and create a detailed post-acquisition plan. This sets out the agreed strategy in full, including initiatives, milestones, key performance indicators (KPIs) and responsibilities. Whilst the management team is responsible for daily operations, Cinven executives join the board and remain involved in the areas of strategic direction and value creation.
Cinven’s Portfolio team has an active support role and works alongside our deal teams and board representatives to build long-term, sustainable businesses that continue to grow after they leave Cinven ownership. The combined Cinven team works together with our portfolio companies in the following areas:
- revenue growth initiatives: increasing revenues by helping our companies in domestic and international markets;
- improving operations: including increasing efficiency and reducing costs, thereby boosting profit margins; and
- sharing best practice: cross-portfolio sourcing and the sharing of knowledge around common commercial practices.