Stout provided comprehensive IT due diligence and carve-out advisory services to support a private equity firm’s acquisition and separation of an industrial automation and manufacturing business from its parent organization. The engagement evaluated the target’s enterprise applications, infrastructure, cybersecurity posture, and end-to-end order-to-cash processes, with a particular focus on identifying system entanglements and transition risks associated with becoming a standalone company.

Our team assessed shared ERP environments, Microsoft tenancy, CRM and contract management platforms, engineering systems, and network infrastructure, identifying material risks related to legacy systems, manual workflows, data fragmentation, and group-level licensing dependencies. We mapped the full order-to-cash lifecycle across sales, engineering, manufacturing, and fulfillment to highlight inefficiencies and operational vulnerabilities that could impact business continuity post-close.

In addition, we developed actionable carve-out recommendations, including Day One separation priorities, ERP transition options, licensing and contract renegotiation considerations, and a phased modernization roadmap.

Our analysis provided the client with clear visibility into transition costs, timing, and post-close investment requirements, informing valuation, transaction structuring, and the integration strategy while positioning the business for scalable, secure, and independent operations.