Short overview of how Operational M&A delivers a roadmap to the bottom line

1. - 1 -
Pasuba as
business aid delivered
Operational M&A
Approach and deliverables
Pasuba AS
D Høiland
dhoiland@pasuba.no
+47 908 26 006

2. - 2 -
Pasuba as
business aid delivered
Why focus on Operational M&A ?
Background
• 55% - 77% of all mergers fail to deliver on
financial promise announced when the merger
was initiated
(Lajoux, 1998; Fifteen studies 1965-1997 across 7000 M&A’s)
• 95% of our acquisitions over the past decade
yielded ”disappointing results”
(General Electric)
• Average fall of stock prices ~ 4% of acquiring
companies. Generally negative correlation
between M&As and increased profitability
(Business Week study)
Business case for Operational M&A
Operational Preparedness from beginning
.. Outline the joint operations and set operational
targets from the start ..
Secure key personnel
.. Make preliminary management decisions on
main organisational structures ..
Prepare for speed
.. Have a risk evaluated, proven 100 day execution
plan and team in place ..
Execute
.. Empower merger team with decision authority,
resources and close follow up from executive
management ...

3. - 3 -
Pasuba as
business aid delivered
Deal recommendation
Execution
 Share price (EV/EBITDA factor)
 Operational pay-back (NPV or IRR)
 Operational cash flow
 Operational risk and contingencies
 Executive management organisation
 Merger team for execution
100 Day execution plan
Assets
Fleet
Supply
Chain
Geography
LegalHSE
Management
Systems
Organisation
Management
Competence
Resources
Financial
Strategic fit
Operational risk
OPEX impacts
Merger plan
Operational fit
Customers
contracts
ICT and
systems
Determine fit and actions for all aspects of operations
Work closely with Financial and Legal team

4. - 4 -
Pasuba as
business aid delivered
PRE-DUE DILIGENCE MERGERDUE DILIGENCEMoU DEAL
Pre Deal Post Deal
Pre – due diligence
Public information
Operational Due diligence
Company spesific information
Merger
Operational execution within risk profile
Deliverables:
Candidate search
Long list – Short list
Operational evaluation of joint business with
short listed candidates
Strategic and operational fit
• Market outlooks / contractportfoilo
• Assets / Fleet utilisation
• Management capabilities
• Organisational capabilities
• Mgt systems / compliance
• ICT / systems
• Geographical locations
Operational merger risk evaluation
Deliverables:
Deal recomentation from Operations
Input for deal negotiations
Risk and cost valued 100 day execution plan
Operational merger team ready to execute
Management readiness
Revised strategic and operational fit (added
details)
• Customer retention and sales
• Asset / fleet integrity and adoption details
• 1st and 2nd management tier
• Employee competence map
• Detailed organisation structures with
costs
• Geographical reach
Revised operationa merger risk evaluation
and contingency plans
Deliverables:
Executed 100 day merger plan
Merger targets met
Operational synergies on bottom line
Company positioned for
• Further growth
• Next level of business
• New revised strategy
Operationally merged company
18 month operational tuning execution
allocated to line management
Debrief and release Merger team for
work in line organisation
Non operational M&A key topics
Financial and Tax
Legal , liabilities, contract and corporate structures
Start pre-DD
Increase operational details as information is available on shortlisted candidates

5. - 5 -
Pasuba as
business aid delivered
Get merger team consistent, focused and effective
Work with proven check lists, fact sheets and evaluation sheet
One sheet pr Operational area
Use company ledger to
estimate cost and budget
merger costs
Use company competence
structure to man execution
plan
Set preliminary Risk level
Translate operational non-
fit issues to actions
Translate into 100 day execution plan

6. - 6 -
Pasuba as
business aid delivered
Why Pasuba as ?
Field proven approach developed together with
O&G service company world leader
Consistent; Check-lists, fact-, evaluation- and risk-
sheets facilitate consistent collection and use of
information for decision and execution
Fit for purpose; The approach is scaled down to fit
smaller M&A
Get going from start; Experience and approach
makes us operational from the start
Team oriented; We work together with your
management team, financial and legal advisors
Operational performance; Consistent operational
focus delivers post merger performance
Your attention was appreciated
Thanks !!
Pasuba AS
D Høiland
dhoiland@pasuba.no
+47 908 26 006