Our client, a leading independent producer of high-quality, specialty hydrocarbon products, agreed to sell a 50,000 barrel per day refinery, associated delivery terminals, and related assets to an unaffiliated energy company for $435 million.
We were engaged by our client, the seller, to assist them in the separation of a business unit. This engagement began during the pre-close phase and concluded several weeks after the close. The seller has a very small internal IT staff which was deeply involved in supporting a recent ERP implementation. In addition to numerical resource constraints, the organization was relatively inexperienced in planning and executing a business unit separation.
DivIHN assisted both parties in the mutual development of the Transition Services Agreement (TSA). During this process, we participated with the seller in helping the buyer’s IT team develop a deeper understanding of the technology supporting the business to identify their integration risks and expedite the separation. We provided IT project management to the client throughout our engagement, providing planning and execution monitoring and control for pre-close activities, Day One activities, and post Day One separation readiness activities. We also provided and Enterprise Architecture-based review of the technical IT separation requirements and associated issues and risks.
After the close, we collaborated with the internal IT team to review IT lessons learned which become one of the inputs to our final work product, a customized IT Divestiture Playbook. The IT Divestiture Playbook was based on our core M&A IT Integration and Divestiture methodology, which incorporates a multi-phase framework of objectives, tasks, deliverables, and milestones, supported by tools, templates, and sample artifacts. The Playbook is based on best practices, informed by our experience of many M&A projects, and tailored to client’s organizational size, culture, and governance needs.