Stout provided buy-side financial due diligence services to a Mexico City-based middle-market private equity firm in connection with its minority investment in a branded consumer beverage company. The target company markets its products to national mass, club, and grocery retailers, as well as distributors and e-commerce channels, and sources its finished goods through an international manufacturing subsidiary. The investment is intended to support the company’s continued brand growth, retail distribution, and operational scale.

We supported the client through a quality-of-earnings analysis, debt and debt-like analysis, and other transaction support. The target’s import-dependent supply chain, retailer-driven trade promotion programs, and cross-border intercompany structure required a tailored approach to evaluating revenue quality and margin trends. Our work focused on the timing and completeness of trade spend accruals across retailer portal and deduction processes, the impact of newly imposed tariffs on landed costs and pricing, and the effect of intercompany transfer pricing and foreign currency movements on consolidated gross margin.

Our due diligence services helped support the client’s valuation, investment agreement negotiations, and investment decision making by calculating adjusted EBITDA, quantifying debt and debt-like items, and providing other deal-critical insights.