Latest news with #AlixPartners
Forbes
19 hours ago
- Business
- Forbes
The Role Of ITFM And Vertical Software In Private Equity And M&A
Mrutyunjay (Jay) Mohapatra | Senior Vice President | Performance & Technology | AlixPartners. IT financial management (ITFM) is becoming increasingly important in M&A contexts, where deal life cycles can span months to over a year and costs often fluctuate. This is where vertical software in ITFM can offer significant value. 'Vertical software' refers to specialized platforms and tools designed for a specific industry or business function. Building on my last article, this article explores how ITFM can accelerate value creation in the private equity (PE) sector. Defining ITFM And Its Strategic Benefits ITFM is a modern discipline focused on planning, tracking and optimizing IT portfolio spending to ensure alignment with business goals. It provides transparency into where and how IT dollars are spent—across resources, vendors, staff and more—allowing organizations to make smarter, value-driven decisions. Modern ITFM shifts the focus away from pure cost control toward value delivery. It connects IT spending with strategic business outcomes, using tools like automated data ingestion, real-time dashboards, scenario modeling and accountability frameworks. These features support dynamic, continuous decision-making and help highlight areas of overspend or risk in real time. By enabling strategic trade-offs—such as reducing operational costs and reallocating budget toward growth initiatives—ITFM promotes agility and resilience. Automated benchmarking, financial reporting and forecasting replace manual, error-prone processes, creating a more adaptive and insight-driven financial approach. Moving Beyond Legacy IT Cost Models Legacy approaches to IT cost management are typically siloed, opaque and IT-centric. Spend is grouped into broad, uninformative categories with little visibility for business stakeholders. Processes are static and often outdated by the time insights become available. Manual budgeting and lack of real-time monitoring hinder agility. Investment decisions are often made in isolation, disconnected from broader business goals. These rigid methods are especially ill-suited for the dynamic needs of M&A, carve-outs, divestitures or cloud-based operations. Modern ITFM addresses these issues head-on, offering visibility, flexibility and strategic alignment. Embedding ITFM Across The Deal Life Cycle In PE, a typical deal flows as follows: • Deal generation • Due diligence • Day-one planning (also known as the 100-day plan) • Post-merger integration or carve-out • Business plan execution • Exit readiness At each phase, ITFM offers distinct advantages. During deal generation, firms scout for targets aligned with their investment thesis. With ITFM, PEs can gain early visibility into IT spend, benchmark against industry standards and assess performance metrics. In due diligence, ITFM enables a granular evaluation of IT spend, surfacing efficiency opportunities in platforms, operations, governance and delivery. For example, one target in the midst of transitioning to a SaaS model faced major shifts in shared costs and tenancy. ITFM made it easy to model scenarios and evaluate the evolving cost structure. In day-one planning, ITFM supports the creation of an IT operating model aligned with the broader business strategy. It also facilitates financial reporting, transition service agreements and interim IT governance. Acting as a single source of truth, it allows PEs to track evolving spend and priorities from day one and onward. During post-merger integration or carve-outs, ITFM helps manage rapid transitions, identify cost drivers, uncover duplication and synergy opportunities and improve vendor negotiations. For example, in a recent aerospace divestiture I was involved in, outdated manual reporting made financial visibility difficult. ITFM could have enabled a seamless shift of IT finances from the legacy entity to the newly carved-out business unit. When executing the business plan, ITFM supports strategic tech decisions, rapid cost reductions and program recovery. By linking IT spend to business outcomes, it can help augment alignment and value realization. In one case, a reinsurance transformation initiative I worked on repeatedly requested emergency funding due to unclear goals and shifting milestones. With ITFM, transformation costs can be tied to defined business outcomes from the start. At the exit stage, ITFM helps document and validate the IT component of the commercial prospectus. It maintains a traceable record of IT spend from deal origination through closing and beyond. Making ITFM Work: Practical Considerations Like DevOps in development or FinOps in cloud cost control, ITFM introduces an agile mindset to IT finance. This requires both cultural and operational shifts. Companies often begin with a proof of concept or proof of value to address pressing pain points—such as cost visibility, allocation or IT cost-to-serve metrics. For a full implementation, specialized consultancies can guide the setup, with internal teams taking over once foundational practices are established. That said, ITFM isn't a one-size-fits-all solution. It is especially valuable for fast-moving organizations with large, complex IT estates. In contrast, it may be excessive for companies with fixed budgets, fully outsourced IT or minimal IT spending overall. Final Thoughts In private equity—where speed, value creation and decisive execution are everything—ITFM can be a critical enabler of transparency and performance. From scouting deals to executing exits, it provides the structure, insight and adaptability needed to manage IT spend as a strategic asset. Forbes Technology Council is an invitation-only community for world-class CIOs, CTOs and technology executives. Do I qualify?
Yahoo
2 days ago
- Business
- Yahoo
Wells Fargo Reduces PT on Lamb Weston Holdings, Inc. (LW) Stock
Lamb Weston Holdings, Inc. (NYSE:LW) is one of the Best Mid Cap FMCG Stocks to Buy Now. Wells Fargo reduced the target price on the company's stock to $65 from $70, while keeping an 'Overweight' rating, as reported by The Fly. The firm is aggregating models throughout Beverage/Food/HPC and updating the price targets. Notably, the firm highlighted that its target price to earnings is the discount to historical trading ranges, considering the limited near-term volume visibility. Potatoes being sorted on a conveyor belt in a modern packing facility. Lamb Weston Holdings, Inc. (NYSE:LW) has engaged AlixPartners, which is a leading global business advisory firm, to help it evaluate opportunities for near- and long-term value creation and cost savings. In the in-home consumption space, Lamb Weston Holdings, Inc. (NYSE:LW) recently rolled out new private-label products throughout the grocery and club channels. Overall, the company remains focused on identifying new and growing customers to fuel long-term sustainable growth in its business. In North America, Lamb Weston Holdings, Inc. (NYSE:LW) launched new battered and seasoned products, and fridge-friendly fries and tots, improving its addressable market. In the North America retail channel, the company has expanded its licensed brand portfolio to include Onion Rings and Cheesy Potato Bites. Lamb Weston Holdings, Inc. (NYSE:LW) is engaged in the production, distribution, and marketing of frozen potato products. While we acknowledge the potential of LW as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: 13 Cheap AI Stocks to Buy According to Analysts and 11 Unstoppable Growth Stocks to Invest in Now Disclosure: None. This article is originally published at Insider Monkey.
Miami Herald
18-07-2025
- Automotive
- Miami Herald
Trump's auto loan tax break could save working class buyers thousands, experts say
WASHINGTON - A Trump-backed tax holiday on auto loan interest payments could save middle-class Americans several hundred dollars apiece on new U.S.-built vehicle purchases through 2028, according to industry experts. The break comes via a provision in the Republicans' One Big Beautiful Bill Act, a massive tax cut and spending package signed into law by President Donald Trump on July 4. "Auto buyers got an above-the-line tax deduction. That's a rare beast in the zoo of tax policies," economist Patrick Anderson said. He also called it a "sharp U-turn in auto tax policy" from the Biden era, which featured electric vehicle credits used by more affluent customers. There are strings attached to the provision, so not all customers and not all vehicles will qualify. But automakers and analysts alike have cheered the policy change as one that will benefit the working class and nudge buyers toward built-in-America vehicles. "For the subset of taxpayers that are employed, earn between $50,000 and $100,000 in salary, and are ready to buy a new car, this could reduce their cost by between $300 and $900 per year, and for heavy borrowers, over $1,000 per year," Anderson's firm, the Lansing, Michigan-based Anderson Economic Group, wrote in an analysis of the new policy. A separate analysis by automotive and industrial consultancy AlixPartners estimated similar benefits of up to $800 in each of the first and second years of auto loans when interest payments are highest, with total savings of approximately $3,000 over the full term of a given loan. The analysis also suggested that about 1.8 million borrowers per year could benefit. "While the auto-loan interest deduction for domestically produced vehicles would of course benefit consumers directly, this measure could help out automakers and dealers as well - if it nudges affordability upward and helps sustain demand. The proof, as always tough, will be in the final pudding," said Akshay Baliga, a director in the automotive and industrial practice at AlixPartners. Trump promised the auto loan tax break on the campaign trail last year, including during a speech to the Detroit Economic Club in October. At the time, he said the tax policy would help both automakers and consumers dealing with high prices across an industry that was "going out of business." Since then, Michigan U.S. Rep. Bill Huizenga, a Republican, has been a champion of the policy in Congress. He introduced a bill on the topic in May titled the "Made in America Motors Act," which was later folded into the Republicans' broader budget package. "Thanks to the No Tax on Auto Loan Interest included in the One Big Beautiful Bill, millions of Americans will find it more affordable to finance the purchase of a new car, minivan, truck, or SUV that is assembled in the United States," Huizenga said in an emailed statement. He added: "By reducing the federal tax burden by up to $10,000, this provision provides substantial relief to hardworking Americans, not just here in Michigan but across the nation, who have suffered from years of Bidenflation. Importantly, this provision will also spur on Michigan's automotive sector and strengthen the good-paying jobs it supports across our state." The White House has given the auto loan tax break top billing in promoting the legislative package, touting it in social media posts alongside wider-reaching "no tax on tips" and "no tax on overtime" policies. The average MSRP of a new vehicle in June was $51,124, according to Kelley Blue Book. That is the second-highest on record behind December 2024 ($51,990). Policy basics The provision applies "above the line," meaning that eligible tax filers will be able to take advantage of the break, even if they claim the widely used standard deduction on their annual federal submission. Individuals earning less than $100,000 in modified adjusted gross income and couples earning less than $200,000 can get the full benefit of the tax break, but it gradually phases out for higher-income filers. Anderson advised potential buyers to confirm their MAGI before making a purchase, since it tends to be higher than the more commonly known AGI. The Internal Revenue Service explains the difference on its website. The economist also advised buyers to double-check with dealers on where vehicles were assembled, since manufacturers often have different assembly locations for different trims of the same model. For anyone under the income cap looking to use the new deduction, the following basic requirements apply: -Purchases made in 2025 (including before July 4), 2026, 2027 and 2028 -No leases -Final vehicle assembly completed in the United States -Vehicle is either a car, minivan, van, sport utility vehicle, pickup truck, or motorcycle made for use on public streets -Vehicle weight below 14,000 pounds -Vehicle is new and for personal use -Loan made by unrelated parties (no family loans) The policy allows annual deductions of up to $10,000, though few filers are likely to claim deductions that high. The deduction provides no benefit for cash-rich buyers who pay off their vehicle in full upon purchase, and limited benefit to buyers who agree to low-APR financing deals with minimal interest accruing. The average interest rate on auto loans for borrowers with good to excellent credit (670 to 850 credit score) ranged from 5.18% to 6.70% in the first quarter of 2025, according to NerdWallet. For borrowers with nonprime or subprime credit (501-660), rates typically fall between 9.83% and 13.22%. Those rates could rise and fall depending on the length of a loan, with shorter loans drawing lower rates and longer ones drawing higher ones. The most common auto loans are between five and seven years. In practical terms, auto borrowers with strong credit who opt to buy a $30,000 vehicle, make a 20% down payment, and accept a 72-month loan would likely face annual interest payments between $1,200 and $1,700 for the first year of their loan. They could deduct a portion of that from their taxes and expect savings in the range of $140 and $360, depending on their federal income tax bracket. A borrower with weaker but still fair credit participating in a similar transaction would save in the range of $290 to $710, though savings in all cases vary depending on a combination of vehicle price, down payment, loan terms and income. Who benefits most? Anderson said that the "sweet spot" for the new tax policy is "younger workers buying a first or second car, working families that need a family-hauler, and trade workers that need lower-trim trucks for their personal use." His analysis included more than two dozen domestically assembled models that will likely benefit from the deduction, with several from Ford Motor Co., General Motors Co. and Stellantis NV. Those models include the Ford Bronco, Escape and lower-trim F-150s; Chevrolet Traverse, Colorado and lower-trim Silverado; and the Jeep Wrangler and Cherokee. Anderson doubted that the luxury market would see much benefit, since buyers in that segment tend to have higher incomes. He also noted that lower- and medium-income buyers who choose to go into debt to purchase expensive cars will be able to deduct "substantial" interest, though their budgets will take a hit in the process. A full list of eligible vehicles, Anderson predicted, will eventually be published by the IRS. Ivan Drury, the director of insights for Edmunds, said the policy will most benefit buyers with poor credit who need to accept higher interest rates to get an auto loan. Drury also predicted that some buyers might choose to put less money down at the time of purchase or opt into extended warranties or maintenance packages, knowing that they are in line for a tax break at the end of the year. "I think for the dealership, this is very beneficial when someone is financing," he said. "It's another leverage point for a dealership to make things more enticing once you're already in there." He also said the benefit is strong for consumers: "It's almost like, is it too good to be true? When you're paying interest, you're just paying the bank, right? You're not getting more car. Nobody wants to pay for the right to borrow." Industry reaction Drury called the new policy a welcome change for consumers but said it is unlikely to be a "volume buster" that supercharges auto sales. "Is it going to make or break the numbers for an OEM or a dealership? Unlikely," he said. "But it will make consumers feel less sting when they see current interest rates, especially people who've been out of the market for over six years, which is the average age for trading a vehicle in for a new car." Anderson's analysis also noted that the new deduction could help offset price increases from Trump's 25% tariffs on imported auto parts. Several automakers and dealers have cheered the new tax break, including Ford Motor Co., which assembled about 80% of its vehicles in the United States last year. "Customers can rest easy knowing America's best-selling trucks, the F-Series, are all assembled in America and qualify for this deduction," company spokesperson Robyn Jackson said in a statement. "As America's top auto producer, we're glad to see Congress and the Trump administration create policies that lower costs for customers and support the American auto industry at the same time." General Motors Co., which built about half of its vehicles in the United States, also celebrated the move. The manufacturer has launched dedicated landing pages for the tax breaks across its Chevy, GMC and Cadillac websites. "GM and its brands have been the engine of growth for the US auto industry this year, and we don't see that changing," company spokesperson Elizabeth Winter said in a statement. Stellantis NV and the Alliance for Automotive Innovation, the industry's top lobbying group, declined to comment. The United Auto Workers did not immediately respond to a request for comment Thursday. The National Auto Dealers Association suggested the policy might nudge sales upward with average new vehicle prices close to all-time highs. "The new provision allowing qualifying car buyers to deduct auto loan interest is designed to help offset some costs and make certain vehicles more affordable. As a result, it is expected to help stimulate car sales for the industry," spokesperson Amy Wright said. Walt Tutak, the dealer trade inventory manager at Matthews-Hargreaves Chevrolet in Royal Oak, said the tax break was "a great thing" but did not expect it to boost sales significantly. Tutak noted that his dealership leases about 70% of new vehicles, transactions that are not covered by the new policy. He suggested that some buyers might switch to purchasing because of their ability to deduct loan interest but expected the impact to be marginal. "If you have to buy a car, you're going to buy it one way or the other," Tutak said in a phone interview. "I might be wrong, but I don't think it's gonna make any more sales. It's just gonna help the consumer." Copyright (C) 2025, Tribune Content Agency, LLC. Portions copyrighted by the respective providers.
Yahoo
17-07-2025
- Business
- Yahoo
Tariffs Give Parents Back-to-School Shoe Anxiety
Eighty percent of consumers expect to pay more for children's shoes this fall due to tariff-driven price increases. According to data points from the 2025 AlixPartners U.S. Consumer Footwear Survey, in partnership with the Footwear Distributors and Retailers of America (FDRA), 16 percent respondents expect shoe prices to increase by 10 percent or less, with 34 percent noting price hikes will range from 10 percent to 25 percent and 30 percent expecting the uptick to be 25 percent or more. More from WWD Kohl's Upping the Ante on Footwear During Critical Back-to-School Season Kristin and Kyle Juszczyk Embrace Classic Footwear Styles for ESPYs 2025 Red Carpet Coats Group to Buy OrthoLite for $770 Million Price was a key driver in purchasing decisions, and the only factor to see an increase in interest versus the 2024 study. Seventy-seven percent said 'absolute lowest prices' was a major factor in their choice of store, either online or in person, versus 74 percent in 2024. It was also the determining factor in where consumers are choosing to shop, with mass market retailers the top retail destination at 23 percent due to brand range and perceived affordability. Specialty stores followed at 18 percent and branded store or website at 17 percent to round out the top three shopping channels for back-to-school (BTS) footwear. Sticker shock is also forcing consumers to rethink their spending patterns. Half of the respondents said they expect brands and retailers to absorb a portion of the cost increases. This same group also said they are both trading down and seeking quality and versatility in what they buy, while they also plan on making fewer purchases. AlixPartners survey: deep dive According to Bryan Eshelman, a partner and managing director at AlixPartners and a co-author of the study, in the upper price tier product lines, brands still matter as well as quality. 'People are willing to spend maybe a little bit more on a per-pair basis, but maybe [they will be] buying fewer pairs,' he said. 'And so when they spend an extra $20 on a pair of shoes, they'll want to make sure it's the right brand, the right quality, and that it's a versatile product that they can wear for a number of occasions so they're getting more bang for their buck in that way.' At the other end of the spectrum, the lower-income consumer will be harder hit by the price increases, largely because lower-priced shoes are produced in countries where tariffs are at a higher rate. And then there are brands such as Nike Inc., which said in May that it was raising prices on select goods, averaging between $2 and $10. But the brand won't be increasing prices on any kids' products, whether footwear or apparel, and there won't be any price increases for any Jordan product. That seems to be a good marketing move for Nike. 'Nike is in a reinvention phase right now, trying to regain their cool factor. So, I think they have a strong incentive to try to direct consumer sales towards the younger product lines to try to rebuild that cool factor,' Eshelman said, adding that 'if I were them, … I'd want to give the impression to the consumer that I'm protecting kids and families from price increases.' He also noted that brands with strong 'brand heat' can probably 'afford to take the price up and get away with it because people are willing to pay for a good product and a great brand.' 'Footwear retailers are stuck between a rock and a hard place,' Matt Priest, FDRA's president and CEO, said in a statement. 'Tariffs raise wholesale costs across the board, but consumers aren't willing — or able — to absorb those increases. That leaves retailers squeezed on both sides, eroding margins and forcing tough decisions on inventory, pricing, and sourcing.' When faced with a 25 percent to 30 percent increase, 33 percent of consumers said they would likely buy cheaper brands, while 35 percent they would reduce spend elsewhere to afford the brands they want, and 38 percent said they would buy fewer pairs to keep within their budget. In addition to the focus on price, 34 percent said they would search for a similar or dupe product at a lower cost, while 33 percent said they would search for a promo code. The survey determined that brands that offer value without compromising on comfort or style — such as the athletic category — are the mostly likely winners. In fact, the athletic/athleisure shoe category saw a projected 28 percent year-over-year increase in spend versus 2024 levels. In contrast, fashion-first retailers and maybe even luxury brands, might struggle to get sales. The fashion/dress shoes or boots category only saw a 3 percent increase in projected spend when compared with 2024 levels. The study found that 73 percent of Gen Z and millennial parents said they'd skip trend-driven footwear styles in favor of 'durability and price.' That also means that both shoe manufacturers and retailers should 'design to value' as consumers trade down and scrutinize style features versus price points, strategists at AlixPartners advised. The study found that consumers also have a preference for retailers that offer buy-now-pay-later options, loyalty rewards and real-time price comparison tools The 2025 survey also took into account the possibility of inventory shortages. The advisory firm recommended that retailers have accurate and timely inventory visibility to meet consumer needs — whether via store-to-store transfer, shipping from store, or shipping from a distribution center — to avoid the risk of disappointing a consumer. And AlixPartners advised that retailers should know what their competitors are doing about pricing and promotional strategies. That's one way to make sure they don't stand out negatively from a pricing perspective. Eshelman said he hasn't seen any indication of low inventory, but noted that consumers are more aware of that possibility due to supply chain issues during the COVID-19 pandemic. He said most retailers have been bringing goods in and taking advantage of pauses in the implementation of higher tariff rates. The AlixPartner retail expert also believes that shoe firms and retailers are bringing more goods in again, now that the tariff deadline was moved out to Aug. 1. And that means consumers may not see price increases for some items until at least through mid-September. That's because much of the assortment mix for BTS and early holiday have landed, and any spike in new tariffs takes effect when the goods 'exit the country, not when they arrive' in the U.S., he explained. Hibbett in June launched a new kids'-focused app for BTS, Adidas earlier this month released an early BTS sneaker collection featuring Sambas, available at Foot Locker and Kids Foot Locker. And in May when Shoe Carnival posted first quarter results, CEO Mark Worden said he was optimistic about BTS sales, given its lack of manufacturing or wholesale operations and the rebanner of Shoe Carnival stores to the Shoe Station brand. Worden said at the time that the company has been in 'close collaboration with vendor partners' and that it has not yet experienced any massive product cost or price increases. The AlixPartners study polled over 1,000 U.S. consumers in June. At that time, nearly half of respondents at 48 percent said they either already started BTS shoe shopping or plan to finish it before July 4, mostly due to concerns over rising prices. Forty-three percent planned to begin between July 5 and Aug. 15, and 9 percent said they would shop after Aug. 15. The peak BTS spend is typically July and August. And in general, those who expect to spend between $150 to $200 per child increased from 15 percent to 19 percent, while those who said they expect to spend between $100 to $150 fell to 24 percent from 29 percent in 2024. The consultancy firm also noted that consumers pulling forward their spend could mean there's less available later on for holiday spend. NRF BTS Survey Separately, the retail trade group National Retail Federation (NRF) said on Tuesday that two-thirds, or 67 percent, of BTS shoppers had already started purchasing items for the upcoming school year, mostly due to concerns that prices will rise because of tariffs. The early start is up from 55 percent in 2024. The 67 percent data point represents the highest since NRF started tracking early shopping in 2018. 'Consumers are being mindful of the potential impacts of tariffs and inflation on back-to-school items, and have turned to early shopping, discount stores and summer sales for savings on school essentials,' said Katherine Cullen, NRF's vice president of industry and consumer insights. The NRF survey found that 84 percent still have at least half of the purchases left to complete, mostly because 47 percent are holding out for the 'best deals.' Another 39 percent aren't sure of what items are need and 24 percent are planning to spread out their budgets Best of WWD All the Retailers That Nike Left and Then Went Back Mikey Madison's Elegant Red Carpet Shoe Style [PHOTOS] Julia Fox's Sleekest and Boldest Shoe Looks Over the Years [Photos] Sign in to access your portfolio
Sky News
14-07-2025
- Business
- Sky News
Lenders to ailing oil refinery's petrol forecourts arm plot sale
Lenders to the petrol forecourts arm of the ailing group behind the Prax Lindsey oil refinery have drafted in City advisers ahead of the business being put up for sale. Sky News has learnt that AlixPartners, the professional services firm, has been engaged by a syndicate of funds which are owed more than £200m by Prax Group's retail operations. The unit trades from more than 200 sites across the UK, according to the company's website, with reports at the weekend suggesting that some sites are facing fuel shortages because of supply agreements that they have with the group's refinery in Lincolnshire. The refinery collapsed into compulsory liquidation last month and is now being run by restructuring experts at FTI Consulting on behalf of the Official Receiver. The plant - one of only a handful of oil refineries still operating in the UK - supplies roughly 10% of the UK's fuel. Last week, Sky News revealed that the Official Receiver had set prospective buyers of Prax Lindsey a two-week deadline to buy the site, although many in the industry expect it to be wound down rather than sold. The petrol forecourts arm - which is not itself in administration - is likely to draw interest from industry peers. Ministers have ordered an Insolvency Service probe into the conduct of the husband-and-wife team behind State Oil, parent company of the Prax Group, alleging they were misled about the company's finances in the build-up to its insolvency. The group is reported to owe the UK tax authorities in the region of £250m, with insiders saying that Sanjeev Kumar Soosaipillai and his wife Arani had been in talks about a Time to Pay arrangement with HM Revenue & Customs prior to State Oil's collapse.
