Cross-Border Due Diligence & Post-Merger Integration of a Distressed €100M Industrial Group

Context

A leading industrial communications group targeted the acquisition of a distressed €100M business operating five sites across Germany, the Czech Republic, and Poland. The company had entered protective insolvency following years of operational instability, weak leadership alignment, and margin deterioration.

I was appointed to lead the operational due diligence, and subsequently the post-merger integration and operational turnaround, ensuring the business could be stabilised and integrated without compromising the Group’s financial position.

Challenge

The business suffered from deep structural issues:

• Severe cash burn, threatening the financial stability of the acquiring Group.

• H&S and HR compliance failures at German sites.

• High churn and low morale in the Czech operation.

• Institutionalised German leadership, resistant to change and disconnected from commercial realities.

• Union resistance, reinforcing a status-quo mindset.

• Cultural divide between German and Czech teams, leading to mistrust and siloed working practices.

• No central planning, causing some sites to run over capacity while others were underutilised.

• Outdated processes and limited standardisation, resulting in inefficiency, unpredictability, and service failures.

The key question was whether the business could be stabilised quickly enough to protect customers, cash, and the value thesis of the acquisition.

Approach & Execution

The transformation was delivered in two phases: pre-acquisition due diligence and post-acquisition operational turnaround.

1. Operational Due Diligence

We conducted a six-week cross-border due diligence programme focused on viability, risk, and synergy potential.

Operational Audits - Site assessments across all three countries identified workflow inefficiencies, compliance risks, and immediate cost exposures.

Leadership & Culture Assessment - Identified the need for a leadership reset in Germany and cultural repair between Germany and the Czech Republic.

Cost Structure Review - Analysed manufacturing economics, footprint utilisation, and procurement. Quantified €10M in synergy opportunities through consolidation, procurement leverage, and productivity gains.

Technology & Service Assessment - Recommended automation upgrades and a shift toward higher-margin digital and fulfilment services.

Integration Blueprint - Designed the integration route map covering footprint strategy, planning model, leadership actions, procurement optimisation, and cultural alignment.

This blueprint informed the acquisition decision.

2. Post-Merger Integration & Operational Turnaround

After completion, I was seconded to deliver the turnaround and prepare the business for integration.

A. Stabilisation, Governance & Cultural Reset

The priority was to halt losses and rebuild discipline.

• Introduced H&S standards, immediate corrective actions, and daily routines to eliminate compliance risk.

• Launched 5S workshops across sites to restore operational discipline and create visible best-practice areas.

• Facilitated leadership exchanges between German and Czech sites to rebuild trust and cooperation.

• Made targeted leadership changes in Germany to enable behavioural and cultural reset.

• Delivered cross-site leadership workshops to form a unified management team.

• Engaged unions early to secure flexible working agreements essential for capacity management.

• Introduced production incentives and bonuses to boost engagement and reinforce accountability.

  
  

B. Operational Integration & Capacity Management

The business lacked coordinated planning and transparency.

• Created a central planning function to balance workloads across all sites and manage bottlenecks proactively.

• Diverted work to underutilised sites to protect customer lead times.

• Built outsourcing channels to manage demand spikes.

• Implemented performance scorecards, KPIs, and daily routines, creating urgency and enabling rapid problem-solving.

• Standardised reporting across sites to improve visibility and decision-making.

  
  

C. Footprint Optimisation, Cost Restructuring & Margin Recovery

The footprint strategy was rebuilt to match skills, cost structures, and product economics.

• Returned high-skill, high-value work to Germany to improve reliability.

• Shifted labour-intensive, low-margin work to the Czech Republic to reduce cost.

• Phased out structurally unprofitable product lines.

• Leveraged Group purchasing power to renegotiate material pricing, improve terms, and diversify suppliers.

These actions stabilised cash flow, improved working capital, and restored service reliability.

Results

Performance & Organisation

• Cross-country cooperation strengthened; silos eliminated.

• Operational discipline and leadership alignment restored.

Financial

• Break-even achieved within 12 months, recovering from a €10M annual loss at acquisition.

• Sharp improvement in labour efficiency, throughput, and quality stability.

• Synergy plan delivered through procurement, footprint optimisation, and streamlined product mix.

Strategic

• Business successfully stabilised and integrated into the Group.

• Fully rebranded within the Group’s customer communications division, enabling further growth.

Outcome

The integration transformed a distressed, fragmented business into a stable, cooperative, and margin-improving operation across three countries. The turnaround delivered the acquisition thesis, protected the Group from material financial risk, and established a solid foundation for long-term growth.